Consider a 2 Asset Portfolio with 60% in Google Inc

question 8

Multiple Choice

Consider a 2 asset portfolio with 60% in Google Inc.(GOOG) and 40% in John Deere (DE) .Google has a standard deviation of 60%,John Deere has a standard deviation of 45% and their correlation is 0.2.What is the standard deviation of returns of the portfolio?

• A) 38.33%
• B) 43.35%
• C) 45.25%
• D) 50.00%
• E) 52.50%

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Definitions:

Rate of Return

The percentage of profit or loss on an investment over a specified period of time.

Framing Effect

The cognitive bias where people decide on options based on whether they are presented in a positive or negative way.

Extended Service

A service agreement that extends beyond the standard warranty period, offering additional protection or maintenance services.

iPod Shuffle

A compact and discontinued music player designed by Apple Inc., notable for its small size, lack of a screen, and shuffle feature for playing music in a random order.