CFA Practice Question

There are 294 practice questions for this study session.

CFA Practice Question

An investor invests 30 percent of his wealth in a risky asset with an expected rate of return of 15 percent and a variance of 400, and 70 percent in a T-bill that pays 6 percent. His portfolio's expected return and standard deviation are ______ and ______, respectively.
A. 8.7%; 12%
B. 8.7%; 6%
C. 11.4%; 6%
Explanation: Expected return: 30% x 15% + 70% x 6% = 8.7%

Standard deviation: 30% x 20% = 6%

User Contributed Comments 2

User Comment
eduardodre where 20% does come from?
eduardodre square root of variance in case of need
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