Chapter 10: Return and Risk: The Capital-Asset-Pricing ...

If the correlation between the returns on Stock A and Stock B is -0.5, the standard deviation of the portfolio is 10.58%. As Stock A and Stock B become more negatively correlated, the standard deviation of the portfolio decreases. 10.7 a. Value of Macrosoft stock in the portfolio = (100 shares)($80 per share) = $8,000 ................
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