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AAFM Chartered Wealth Manager (CWM) Global Examination GLO_CWM_LVL_1 Question # 191 Topic 20 Discussion

AAFM Chartered Wealth Manager (CWM) Global Examination GLO_CWM_LVL_1 Question # 191 Topic 20 Discussion

GLO_CWM_LVL_1 Exam Topic 20 Question 191 Discussion:
Question #: 191
Topic #: 20

As a CWM® you recommended Mr. Raj Malhotra to put his money in Asset A offering 15% annual return with a standard deviation of 10%, and balance funds in asset B offering a 9% annual return with a standard deviation of 8%. Assume the coefficient of correlation between the returns on assets A and B is 0.50. Calculate the expected return after 1 year and standard deviation of Mr. Raj Malhotra’s portfolio


A.

12.60% and 0.809%


B.

11.67% and 8.75%


C.

12.60% and 8.09%


D.

8.09% and 12.60%


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