A

risky asset has an expected return of 31% and a standard deviation of 60%. A

risk-free asset has a return of 2.30%. What is the standard deviation of the

portfolio consisting of 40% of the risky asset and 60% of the risk-free asset?

Which

of the following statements is correct?

Choose

the best option. The tangent line from the risk-free return to the efficient

frontier consisting of many risky assets has the following property:

You

have $12,000 that you want to spend on purchasing TSLA stocks that are worth $800.00

per share. If you are purchasing TSLA stocks on margin, and the initial margin

requirement is 60%, and the maintenance margin requirement is 40%, what is the

maximum amount of TSLA shares you could buy?

There

are four investors with the same standard quadratic utility function (U = E(r)

– ½Aσ

Choose the best option. Portfolio

diversification does

You have invested in an asset that has the following expected returns across the three potential states of the economy over the next year:

Calculate the expected return and standard deviation of this asset (correct to one decimal place).

Stock

A’s expected return and variance are 0.12 and 0.0424, respectively. Stock B’s expected

return and variance are 0.25 and 0.1234, respectively. The two securities have

a correlation coefficient of 0.55. What are the weights of securities A and B,

w(A) and w(B), in the MVP?

Jimmy

has just sold AON stocks at $281.16 per share. Jimmy bought these stocks five

years ago on NYSE at $139.16 per share. During

this period, he received total dividends worth $4.50 per share. What is Jimmy’s holding

period annualized arithmetic average return?