A Portfolio Has 50% of Its Value in ASX Shares

question 60

Multiple Choice

A portfolio has 50% of its value in ASX shares and the rest in Woodside Petroleum (WPL) . The volatilities of ASX and WPL are 20% and 20%, respectively, and the correlation between ASX and WPL is 0. What is the standard deviation of the portfolio?

• A)12.17%
• B)14.14%
• C)19.52%
• D)11.51%

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Definitions:

Economy Will Produce

Refers to the total output of goods and services that an economy generates over a specific time frame.

Outside The Frontier

Referring to production or economic activity occurring at a level below the potential or efficient production frontier, indicating underutilization of resources.

Available Technology

Refers to the current set of tools, machinery, and methods that can be used to produce goods and services.

Inefficient Use

refers to the scenario where resources are not being utilized in the best possible manner, leading to waste or suboptimal outcomes.