Expected Rate of Return Counter- Utility Treasury Bill Index Fund Company High-Tech Company Cyclical Company Scenario Recession Probability 20% 5% -10% 6% -25% 20% Near Recession 20% 5% -6% 7% -20%...

With reference to the information given above,

Discuss the relationship between risk and return of the individual securities.

Demonstrate the meaning and advantages of diversification by constructing a portfolio consisting of equal investments in the High-Tech Co. and the Counter- Cyclical Co. Explain your idea and show your work clearly.

Perform calculations or quantitative analyses to support your answers where necessary.

Extracted text: Expected Rate of Return Counter- Utility Treasury Bill Index Fund Company High-Tech Company Cyclical Company Scenario Recession Probability 20% 5% -10% 6% -25% 20% Near Recession 20% 5% -6% 7% -20% 16% Normal 30% 5% 12% 9% 15% 12% Near Boom 10% 5% 15% 11% 25% -9% Вoom 20% 5% 20% 14% 35% -20% Expected Return 5% 5.9% 9.2% 5% 5.9% Standard Deviation 0% 11.94% 2.82% 24.19% 15.69%