You own a stock portfolio invested 12 percent in Stock Q, 16 percent in Stock R,
ID: 2682272 • Letter: Y
Question
You own a stock portfolio invested 12 percent in Stock Q, 16 percent in Stock R, 30 percent in Stock S, and 42 percent in Stock T. The betas for these four stocks are 0.77, 1.76, 1.32, and 1.26, respectively. The portfolio beta is . (Round your answer to 2 decimal places. (e.g., 32.16))
You own a stock portfolio invested 12 percent in Stock Q, 16 percent in Stock R, 30 percent in Stock S, and 42 percent in Stock T. The betas for these four stocks are 0.77, 1.76, 1.32, and 1.26, respectively. The portfolio beta is . (Round your answer to 2 decimal places. (e.g., 32.16))
Explanation / Answer
Portfolio beta = (0.20)(1.10) + (0.40)(0.95) + (0.25)(1.40) + (0.15)(0.70) = 1.06