The stocks of Spaulding (S) and Johnson (J) Corporations have the following risk and return statistics: E(rJ) = 14%, ?J = 22%; E(rS) = 16%, ?S = 25%. [Round any calculation to two decimal points]
A. Which of the two stocks is relatively riskier? Why?
B. If the correlation between the two stocks is .5, determine the minimum risk portfolio.