Use the table for the question(s)below.
Consider the following expected returns,volatilities,and correlations:
-Consider a portfolio consisting of only Duke Energy and Microsoft.The percentage of your investment (portfolio weight)that you would place in Duke Energy stock to achieve a risk-free investment would be closest to:
A)15%.
B)80%.
C)23%.
D)10%.

Question

Use the table for the question(s)below.
Consider the following expected returns,volatilities,and correlations: 
-Consider a portfolio consisting of only Duke Energy and Microsoft.The percentage of your investment (portfolio weight)that you would place in Duke Energy stock to achieve a risk-free investment would be closest to:
A)15%. 
B)80%. 
C)23%. 
D)10%.

Quizplus · Accepted Answer

To achieve a risk-free investment, you would need to find the portfolio weights that eliminate risk, which typically involves a high allocation to a stable, low-volatility stock like Duke Energy.

Use the Table for the Question(s)below