A Portfolio Has 30% of Its Value in IBM Shares

question 86

Multiple Choice

A portfolio has 30% of its value in IBM shares and the rest in Microsoft (MSFT) .The volatility of IBM and MSFT are 35% and 30%,respectively,and the correlation between IBM and MSFT is 0.3.What is the standard deviation of the portfolio?

• A)22.35%
• B)26.15%
• C)30.23%
• D)29.67%

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Definitions:

Arson

The intentional act of setting fire to property, buildings, or wildland areas with malicious intent.

Willful Destruction By Fire

An act of intentionally setting fire to property, typically constituting a criminal offense.

Forgery

The act of falsely making or altering a document with the intent to defraud, such as signing another person's name to a check.

Counterfeiting

The creation of imitation products, currency, or documents with the intent to deceive or defraud by passing the fake item off as genuine.