Do bonds reduce the overall risk of an investment portfolio? Let x be a random variable representing annual percent return for the Vanguard Total Stock Index (all Stocks). Let y be a random variable representing annual return for the Vanguard Balanced Index (60% stock and 40% bond). For the past several years, assume the following data. Compute. $$\sum y ^ { 2 }$$ $$\begin{array} { l l l l l l l l l l l }
x : & 12 & 0 & 37 & 24 & 35 & 26 & 27 & - 12 & - 12 & - 24 \
y : & 8 & - 5 & 28 & 15 & 25 & 16 & 15 & - 5 & - 6 & - 8
\end{array}$$
A)2304
B)2240
C)2265
D)2268
E)2329

Question

Do bonds reduce the overall risk of an investment portfolio? Let x be a random variable representing annual percent return for the Vanguard Total Stock Index (all Stocks). Let y be a random variable representing annual return for the Vanguard Balanced Index (60% stock and 40% bond). For the past several years, assume the following data. Compute. $$\sum y ^ { 2 }$$ $$\begin{array} { l l l l l l l l l l l } 
x : & 12 & 0 & 37 & 24 & 35 & 26 & 27 & - 12 & - 12 & - 24 \
y : & 8 & - 5 & 28 & 15 & 25 & 16 & 15 & - 5 & - 6 & - 8
\end{array}$$
A)2304
B)2240
C)2265
D)2268
E)2329

Quizplus · Accepted Answer

The Answer of Do bonds reduce the overall risk of an investment portfolio? Let x be a random variable representing annual percent return for the Vanguard Total Stock Index (all Stocks). Let y be a random variable representing annual return for the Vanguard Balanced Index (60% stock and 40% bond). For the past several years, assume the following data. Compute. $$\sum y ^ { 2 }$$ $$\begin{array} { l l l l l l l l l l l } 
x : & 12 & 0 & 37 & 24 & 35 & 26 & 27 & - 12 & - 12 & - 24 \
y : & 8 & - 5 & 28 & 15 & 25 & 16 & 15 & - 5 & - 6 & - 8
\end{array}$$
A)2304
B)2240
C)2265
D)2268
E)2329

Do Bonds Reduce the Overall Risk of an Investment Portfolio ∑y2\sum y ^ { 2 }∑y2

Do Bonds Reduce the Overall Risk of an Investment Portfolio $\sum y ^ { 2 }$