Variance of market portfolio formula

The expected return of a portfolio is equal to the weighted average of the returns on individual assets in the portfolio.

Keep in mind that this is the calculation for portfolio variance. If a test question asks for the standard deviation then you will need to take the square root of the variance calculation. Percentage values can be used in this formula for the variances, instead of decimals.

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Expected Return and Variance for a Two Asset Portfolio.

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Variance of market portfolio formula weights for the two assets are: Try our courses on Data Science for Finance. Leave a Reply Cancel reply Your email address will not be published.

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