QUIZ

Question no 1:
Calculate the risk and return of a three-asset portfolio, the following information for each asset in the portfolio are
as follows:
1. The weight of each asset in the portfolio.
2. The expected return of each asset.
3. The standard deviation (risk) of each asset.
4. The correlations between each pair of assets.

Portfolio Asset 1 Asset 1 Asset Asset 2 Asset 2 Asset Asset 3 Asset 3 Asset Correlation Correlation Correlation
Weight Return 1 Risk Weight Return 2 Risk Weight Return 3 Risk (1,2) (1,3) (2,3)
Portfolio 0.4 ? ? 0.3 ? ? 0.3 ? ? 0.6 0.4 0.7
1
Portfolio 0.5 ? ? 0.3 ? ? 0.2 ? ? 0.5 0.3 0.8
2
Portfolio 0.3 ? ? 0.4 ? ? 0.3 ? ? 0.4 0.6 0.7
3

Question no 1: