Variance of 2 Asset Portfolio Question

[jmuduke08]

I am confused with a calculation with finding the variance of a 2 asset portfolio return (asset a and b) from the Schweser material.
Part of the formula says o^2 (Ra) - with o representing standard deviation and Ra representing the expected return of asset A.
Yet, when I look at examples of this formula being used, it appears this term (listed above) is being substituted for the Variance of Ra. I dont understand how these two terms are equal/substitutable. Thanks in advance

 

[Oscar]

Var(A;B) = wA * Var(A) + wB * Var(B) + 2 * wa * wB * Std(A) * Std(B) * Corr(A;B)
with
Cov(A;B) = Std(A)*Std(B)*Corr(A;B)
So you could also write:
Var(A;B) = wA * Var(A) + wB * Var(B) + 2 * wa * wB * Cov(A;B)
The first and the last formula are interchangeable.

 

[breadmaker]

I think σ^2 (Ra) means the variance of asset a; are you interpreting it as σ^2 times Ra?

 

[Harrogath]

’Oscar’ wrote:
Var(A;B) = wA^2 * Var(A) + wB^2 * Var(B) + 2 * wa * wB * Std(A) * Std(B) * Corr(A;B)
with
Cov(A;B) = Std(A)*Std(B)*Corr(A;B)
So you could also write:
Var(A;B) = wA^2 * Var(A) + wB^2 * Var(B) + 2 * wa * wB * Cov(A;B)
The first and the last formula are interchangeable.

The weights go squared for the variances, so it would be: wA^2 and wB^2

 

[Frankliving]

Firstly my tip is to look at the formula in the curricullum whenever you are unseure or something in schweser does not make sense.
o^2 = variance
So it does not matter whether you write o^2 or variance, as long as its:
W = weight
V = variance
Covab = covariance
(Wa^2 x Va) + (Wb^2 x Vb) + (2 x Wa x Wb x Covab)