Which of the following is not required to compute the standard deviation of a tw
ID: 2699327 • Letter: W
Question
Which of the following is not required to compute the standard deviation of a two-stock portfolio? Answer
the variance in returns on each stock
the amount invested in each stock
the correlation between the returns on each stock
the expected return on a risk-free asset
The total risk of a well-diversified international portfolio of stocks appears to be about what proportion of the risk of an average one-stock portfolio? Answer
one-third
one-half
two-thirds
three-fourths
If the _____________ of a stock is known, an investor can use the security market line to determine the expected return on that stock. Answer
standard deviation
beta
coefficient of variation
unsystematic risk
Explanation / Answer
Which of the following is not required to compute the standard deviation of a two-stock portfolio?
the expected return on a risk-free asset
The total risk of a well-diversified international portfolio of stocks appears to be about what proportion of the risk of an average one-stock portfolio?
One-Third
If the _____________ of a stock is known, an investor can use the security market line to determine the expected return on that stock. Answer
Beta