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Solving it algebraically: As seen in the above provided reference (just above " 1) "), the general formulation for the unconstrained Markowitz portfolio optimization scheme, is given by: \begin{align} &\text{arg}\max_{w} \; w^T\mu-\frac{\delta}{2} w^T\Sigma w.\\ \end{align} In absence of any constraints, the above optimization scheme have the ...


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The number of up moves of the stock $S$ after 100 days follows binomial distribution. To calculate expected value of the stock we have to weight values by probability mass function. After 100 days we have $k$ up moves of $1+10\%$ and $100-k$ down moves of $1-10\%$ i.e. the value of the stock is $S_0*(1+10\%)^k*(1-10\%)^{(100-k)}$ with probability ${100}\...


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