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problem: Assume that securities A & B are perfectly negatively correlated, with expected returns 8% and 12% and standard deviations 15 percent and 25 percent, respectively. find out the risk-free rate or the rate of return on a risk free portfolio.

Suggestion: You have to make a portfolio with zero volatility

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M919141

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