Problem 5-13 Assume that you manage a risky portfolio with anexpected rate of return of 12% and a standard deviation of 47%. TheT-bill rate is 4%. Your risky portfolio includes the followinginvestments in the given proportions: Stock A 31 % Stock B 31 %Stock C 38 % Your client decides to invest in your risky portfolioa proportion (y) of his total investment budget with the remainderin a T-bill money market fund so that his overall portfolio willhave an expected rate of return of 10%. a. What is the proportiony? (Round your answer to 2 decimal places.) Proportion y b. Whatare your client's investment proportions in your three stocks andthe T-bill fund? (Round your intermediate calculations and finalanswers to 2 decimal places.) Security Investment ProportionsT-Bills % Stock A % Stock B % Stock C % c. What is the standarddeviation of the rate of return on your client's portfolio? (Roundyour intermediate calculations and final answer to 2 decimalplaces.) Standard deviation % per year
