Stock a Has a Standard Deviation of 15 Percent Per

question 73

Multiple Choice

Stock A has a standard deviation of 15 percent per year and stock B has a standard deviation of 21 percent per year. The correlation between stock A and stock B is .32. You have a portfolio of these two stocks wherein stock B has a portfolio weight of 60 percent. What is your portfolio standard deviation?

• A) 14.87 percent
• B) 15.59 percent
• C) 16.91 percent
• D) 17.45 percent
• E) 18.03 percent

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Definitions:

Conscientiousness

A personality trait characterized by diligence, carefulness, thoroughness, and organization.

Big Five Trait

A model that outlines five broad dimensions of human personality traits, including openness, conscientiousness, extraversion, agreeableness, and neuroticism.

Volunteering

The act of offering services willingly without the expectation of payment.

Agreeableness

A personality trait characterized by warmth, friendliness, and a cooperative disposition.