Portfolio risk and return Emma holds a $7,500 portfolio that consists of four stocks. Her investment in each stock, as well as each stock’s beta, is listed in the following table: Stock Investment...

Portfolio risk and return

Emma holds a $7,500 portfolio that consists of four stocks. Her investment in each stock, as well as each stock’s beta, is listed in the following table:

Stock	Investment	Beta	Standard Deviation
Andalusian Limited (AL)	$2,625	0.80	15.00%
Kulatsu Motors Co. (KMC)	$1,500	1.90	11.00%
Water and Power Co. (WPC)	$1,125	1.10	16.00%
Makissi Corp. (MC)	$2,250	0.50	28.50%

Suppose all stocks in Emma’s portfolio were equally weighted. Which of these stocks would contribute the least market risk to the portfolio?

Kulatsu Motors Co.

Makissi Corp.

Andalusian Limited

Water and Power Co.

Suppose all stocks in the portfolio were equally weighted. Which of these stocks would have the least amount of stand-alone risk?

Water and Power Co.

Makissi Corp.

Andalusian Limited

Kulatsu Motors Co.

Jun 10, 2022

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Portfolio risk and return Emma holds a $7,500 portfolio that consists of four stocks. Her investment in each stock, as well as each stock’s beta, is listed in the following table: Stock Investment...

Portfolio risk and return

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