You have decided to create a portfolio with two assets: stock X and stock Y. You invest 20% of your funds in X and 80% of your funds in stock Y. The standard deviation of X is 30% and the standard deviation of Y is 40%
The two stocks have a correlation coefficient of - 0.5. What is the portfolio's standard deviation?
A) 30.00%
B) 29.46%
C) 33.24%
D) 36.92%
E) 40.00%
B
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