Answer Happy

With the unexpected success of Marc's Ferrari Driving Company (MFDC), competitors are starting to emerge. The latest is David's Kia Driving Company (DKDC). Personally, I think he's missed the entire point of the business... You've studied the industry carefully, and feel confident that the information in the following table describes the expected performance of each of these firms. Company MFDC DKDC Expected Annual 15.4% 8.7% Return. Risk for the annual 12.9% 7,9% returns Beta 1.1 0.4 Current Stock $17.79 $21.59 Price You've also learned that the correlation between MFDC and DKDC is 0.65. You will purchase 700 shares of MFDC and 370 shares of DKDC to construct your portfolio. What is the risk for this portfolio? (answer using a percentage rounded to two decimal places, for example, if your answer is 5.678% you should enter 5.68) Type your answer......