Outlines the portfolio return and variance estimates for the portfolio of the two risky assets. Particular attention is paid to understanding the benefits of diversification and emphasizing often misunderstood point that there are advantages of diversification, even if the return to the two stocks are positively correlated. The note is intended for use as a supplement to reading class, where students implement equations with real data. "Hide
by Jonathan F. Spitzer 4 pages. Publication Date: November 16, 2006. Prod. #: UV3962-PDF-ENG
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