Expected Return, Variance and Confidence
Here is the exercise:
Matt has $14,000 to invests and decides to put $1000 in each of his 14 stocks picked at random from a large listed on the stock exchange. The mean return of the stocks in the group is 10% per year and the variance of the returns of the stocks in the group is 4% per year.
a. Calculate expected return and variance
b. Calculate 90% confidence interval for the portfolio returns
I know how to calculate the expected value E(X) = x1 P(X=x1) + x 2(X=x2) + ... not sure in this case though... is it just 1000(.10) + 1000(.10) + 1000(.10) +.... ??
Greatly appreciate some help