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Stocks A and B have the following historical retur...

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Stocks A and B have the following historical returns: Stock A Returns Stock B Returns Year rA rB 2002 (18%) (14.5%) 2003 33% 21.80% 2004 15% 30.50% 2005 (0.50%) (7.60%) 2006 27.00% 26.30% What would have been the realized rate of return on the portfolio in each year? What would have been the average rate of returno n the portfolio during this period? Calculate the coefficient of variation for each stock and for the portfolio.,e) Assuming you are a risk-averse investor, would you prefer to hold Stock A, Stock B, or the portfolio ? why ?

 

Paper#10268 | Written in 18-Jul-2015

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