Expected Return and Standard Deviation of Two Securities Assignment
February 18th, 2020
The Lubin’s Investment Team is considering investing in two securities, A and B, and the relevant information is given below:
State of the economy | Probability | Return on A(%) | Return on B(%) |
Trough | 0.05 | -20% | 2% |
Recession | 0.4 | -5% | 2% |
Expansion | 0.5 | 15% | 2% |
Peak | 0.05 | 20% | 2% |
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