alleryStart learning →Four uncorrelated assets, each with variance 0.04, are held in equal weights. What is the portfolio's standard deviation?
A20%
B4%
C5%
D10%
Answer & Solution
Correct answer: D. 10%
Variance = 4 x (0.25 squared) x 0.04 = 0.01, so the standard deviation is the square root, 10%.
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