An investor is calculating the risk-return combination of investment in country a and country b.
Here is the given data from those two countries.
Country A
Return: 18%
Variance: 225%
Investment Weigh: 2/3
Country B
Return: 16%
Variance: 196%
Investment Weigh: 1/3
Calculate risk-return of those portfolios at correlation level:
a) 0.75
b) -0.5
c) 0.5
Questions:
What kind of plot can you make from the calculation/risk-return combination?