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babymother [125]
3 years ago
10

The volatility of Home Depot share prices is 20% and that of General Motors shares is 20%. When I hold both stocks in my portfol

io, the overall volatility of the portfolio is ________.
Business
2 answers:
pochemuha3 years ago
3 0

Answer:

The question is either incomplete or not possible to calculate as information is inadequate

Explanation:

soldi70 [24.7K]3 years ago
3 0

Answer:

The correct answer is letter "D": not possible to calculate as information is inadequate.

Explanation:

Portfolio Variance provides a measure of portfolio volatility. Portfolio variance is a two-sided function: the first of these is the variance of each portfolio asset; the second is how each of those assets is fluctuating in relation to each other, which is the covariance towards each other.

Thus, <em>to determine the volatility of a portfolio several factors of each asset included must be considered, not only the share price of the stocks that compose the portfolio</em>. The information provided in the example is vague and inadequate.

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