The Stock Market of Country a Has an Expected Return

question 31

Essay

The stock market of country A has an expected return of 5 percent,and standard deviation of expected return of 8 percent.The stock market of country B has an expected return of 15 percent and standard deviation of expected return of 10 percent.
Assume that the correlation of expected return between A and B is negative 1.Calculate the standard deviation of expected return of the portfolio in the last question.

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Definitions:

Chronic

Relating to illnesses or conditions persisting for a long time or constantly recurring.

Intermittent

Occurring at irregular intervals; not continuous or steady.

Generalized Anxiety Disorder

A mental health disorder characterized by persistent and excessive worry about various aspects of life, not limited to one specific issue.

Constant Worry

A persistent state of anxiety where an individual is often overly concerned about a variety of issues beyond their control.