Suppose an individual is able to invest in shares of Sultan plc, in shares of Ahmed plc or in a portfolio made up from Sultan plc and Ahmed plc. Event ( weather for season) Probability of event Pi Returns on Sultan plc Rs Returns on Ahmed plc RA Warm 0.2 20 -10 Average 0.6 15 22 Wet 0.2 10 44 Required:a- Calculate expected return and standard deviation of company Sultan and Ahmed?b- What are the covariance and the correlation coefficient between returns on Sultan plc and returns on Ahmed plc?

Suppose an individual is able to invest in shares of Sultan plc, in shares of Ahmed plc or in a portfolio made up from Sultan plc and Ahmed plc. Event ( weather for season) Probability of event Pi...

Suppose an individual is able to invest in shares of Sultan plc, in shares of Ahmed plc or in a portfolio made up from Sultan plc and Ahmed plc.

Required:

a- Calculate expected return and standard deviation of company Sultan and Ahmed?

b- What are the covariance and the correlation coefficient between returns on Sultan plc and returns on Ahmed plc?

Jun 10, 2022