Which of the following statements about short-selling is **NOT** true?

An investor wants to make a portfolio of two stocks A and B with a target expected portfolio return of **6**% pa.

- Stock A has an expected return of
**5**% pa. - Stock B has an expected return of
**10**% pa.

What portfolio weights should the investor have in stocks A and B respectively?

**Question 558** portfolio weights, portfolio return, short selling

An investor wants to make a portfolio of two stocks A and B with a target expected portfolio return of **16**% pa.

- Stock A has an expected return of
**8**% pa. - Stock B has an expected return of
**12**% pa.

What portfolio weights should the investor have in stocks A and B respectively?

An investor owns a portfolio with:

- 80% invested in stock A; and
- 20% invested in stock B.

Today there was a:

- 10% rise in stock A's price; and
- No change in stock B's price.

No dividends were paid on either stock. What was the total historical **portfolio** return on this day? All returns above and answer options below are given as effective daily rates.