Show that the (percent) return of the portfolio satisfies Tp = WATA + WBTB, i.e. the portfolio return is equal to the weighted average of the returns of its composite assets. Let us now calculate the...

Show that the (percent) return of the portfolio satisfies<br>Tp = WATA + WBTB,<br>i.e. the portfolio return is equal to the weighted average of the returns of its<br>composite assets.<br>Let us now calculate the expected return e, of the portfolio<br>ep = E(rp) = E(WATA + WBTB)<br>= WĄCĄ + WB@B<br>and its variance<br>o = D(r,) = D(WATA + WBTB) = w%o%+ whoB + 2p WAWB JAJA-<br>|3D<br>

Extracted text: Show that the (percent) return of the portfolio satisfies Tp = WATA + WBTB, i.e. the portfolio return is equal to the weighted average of the returns of its composite assets. Let us now calculate the expected return e, of the portfolio ep = E(rp) = E(WATA + WBTB) = WĄCĄ + WB@B and its variance o = D(r,) = D(WATA + WBTB) = w%o%+ whoB + 2p WAWB JAJA- |3D

Jun 05, 2022

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Show that the (percent) return of the portfolio satisfies Tp = WATA + WBTB, i.e. the portfolio return is equal to the weighted average of the returns of its composite assets. Let us now calculate the...

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