Mathematics
Mathematics, 22.10.2019 21:00, chino54

4. let x and y represent the rates of return (per cent) on two stocks. you are told that x~n(18, 25) and y~n(9, 4), and that the correlation coefficient between the two rates of return is -0.7. suppose you want to hold the two stocks in your portfolio in equal proportion. a. what is the probability distribution of the return on the portfolio? b. is it better to hold this portfolio or to invest in only one of the two stocks? why?

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4. let x and y represent the rates of return (per cent) on two stocks. you are told that x~n(18, 25)...

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