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AAFM CWM_LEVEL_2 Exam - Topic 7 Question 94 Discussion

Section C (4 Mark)A portfolio consists of 3 securities.What is the standard deviation of the portfolio?
B) 3.5
A) 2.5
C) 7.7
D) 6.9

AAFM CWM_LEVEL_2 Exam - Topic 7 Question 94 Discussion

Actual exam question for AAFM's CWM_LEVEL_2 exam
Question #: 94
Topic #: 7
[All CWM_LEVEL_2 Questions]

Section C (4 Mark)

A portfolio consists of 3 securities.

What is the standard deviation of the portfolio?

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Suggested Answer: B

by Scarlet at Dec 07, 2024, 04:43 PM

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Marg
9 months ago
2.5 seems way too low for a portfolio.
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Lorrine
10 months ago
I calculated it too, and I got 7.7.
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Lai
10 months ago
Wait, are we sure about that? Seems high.
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Valentin
10 months ago
Totally agree, 6.9 makes sense!
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Lashawn
10 months ago
I think the standard deviation is 6.9.
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King
11 months ago
I feel like I might be overthinking this. I remember that the answer should be less than the highest individual standard deviation, but I’m torn between 6.9 and 7.7.
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Lashawnda
11 months ago
I think the standard deviation is supposed to reflect the risk of the portfolio, but I’m confused about how to combine the individual variances.
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Stefania
11 months ago
This question feels similar to one we did in our last mock exam, but I can't recall the exact formula we used for the portfolio's standard deviation.
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Noel
11 months ago
I remember we practiced calculating standard deviation in class, but I’m not sure if I got the weights right for each security.
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Laurel
11 months ago
Wait, what? This question is throwing me off. I don't remember learning how to calculate portfolio standard deviation. I better review my notes before attempting this.
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Leanora
11 months ago
Okay, I think I know how to do this. I just need to apply the portfolio variance formula using the given weights and variances. Shouldn't be too tricky.
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Lamar
11 months ago
Hmm, I'm not sure how to approach this. The question doesn't provide much information about the individual securities. I'll have to think this through carefully.
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Coleen
11 months ago
This looks like a standard portfolio risk calculation question. I'll need to use the given weights and variances to compute the portfolio standard deviation.
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Fernanda
1 year ago
Hmm, I wonder if the correct answer is 'all of the above' because the question is so confusing. That's usually the trick, right?
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Antione
1 year ago
This is like a where's Waldo puzzle, but with numbers! I'm going to stare at that image until the answer jumps out at me.
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Fabiola
1 year ago
I'm going with 2.5 for the standard deviation.
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An
1 year ago
I believe it's 3.5 for the standard deviation.
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Louvenia
1 year ago
I'm leaning towards 7.7 for the standard deviation.
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Portia
1 year ago
I think the standard deviation of the portfolio is 6.9.
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Alaine
1 year ago
Wait, is this a trick question? I feel like I'm missing something obvious here.
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Dianne
1 year ago
User 3: I think I got it now, thanks for the clarification!
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Paulina
1 year ago
User 2: So, we need to use the weights of each security and their individual standard deviations to find the portfolio standard deviation.
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Sage
1 year ago
User 1: It's not a trick question, just calculate the standard deviation of the portfolio based on the securities.
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Shelia
1 year ago
Okay, let me think this through step-by-step. I've got this!
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Cordelia
1 year ago
Whoa, this question is trickier than I thought! I need to remember the formula for calculating portfolio standard deviation.
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Rosann
1 year ago
User 3
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Lon
1 year ago
User 2
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Lonny
1 year ago
User 1
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Benedict
1 year ago
I see your point, but I still think it's 3.5 because of the diversification benefits of having 3 securities.
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Josphine
1 year ago
I disagree, I believe it is 6.9.
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Benedict
1 year ago
I think the standard deviation of the portfolio is 3.5.
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