ZuoTi.Pro
Question

You own a portfolio that has a total value of $140,000 and a beta of 1.30. You have another $55,000 to invest and you would l

business   finance   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Beta =Weight of Investment 1 *Beta of Portfolio 1+Weight of Investment 2*Beta of Portfolio 2
1.11 =140000/(140000+55000)*1.30+55000/(140000+55000)*Beta of Portfolio 2
1.11-140000/(140000+55000)*1.30 =55000/(140000+55000)*Beta of Portfolio 2
0.176667=0.282051*Beta of Portfolio 2
Beta of Portfolio 2 =0.176667/0.282051=0.626 (Option d is correct option)

0 0
Add a comment
Know the answer?
Add Answer to:
You own a portfolio that has a total value of $140,000 and a beta of 1.30....
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • You own a portfolio that has a total value of $210,000 and it is invested in...

    You own a portfolio that has a total value of $210,000 and it is invested in Stock D with a beta of 87 and Stock E with a beta of 1.38. The beta of your portfolio is equal to the market beta. What is the dollar amount of your investment in Stock D? Multiple Choice Ο S40,14728 Ο S53,529.41 Ο S46,838.24 Ο $156,470.59 Ο Ο S26,76514

  • You own a portfolio that has a total value of $185,000 and it is invested in...

    You own a portfolio that has a total value of $185,000 and it is invested in Stock D with a beta of .91 and Stock E with a beta of 1.33. The beta of your portfolio is equal to the market beta. What is the dollar amount of your investment in Stock D? Multiple Choice $29,732.37 $34,687.50 $145,357.14 $39,642.86 $19,821.88

  • You own a $36,800 portfolio that is invested in Stocks A and B. The portfolio beta...

    You own a $36,800 portfolio that is invested in Stocks A and B. The portfolio beta is equal to the market beta. Stock A has an expected return of 15 percent and has a beta of 2. Stock B has a beta of 0.5. What is the value of your investment in Stock A? Multiple Choice $10,055 $16,601 $18,539 $12,267

  • A portfolio is comprised of the following stocks. What is the portfolio beta? Stock Market Value...

    A portfolio is comprised of the following stocks. What is the portfolio beta? Stock Market Value of Shares Beta A $ 14,000 1.79 B $ 17,500 .98 C $ 8,600 1.16 1.18 1.45 1.30 1.37 You own a $25,000 portfolio that is invested in a risk-free security and Stock A. The beta of Stock A is 1.70 and the portfolio beta is .95. What is the amount of the investment in Stock A? $14,791 $11,331 $13,971 $16,531

  • You own a portfolio that has $1,700 invested in Stock A and $3,250 invested in Stock...

    You own a portfolio that has $1,700 invested in Stock A and $3,250 invested in Stock B. If the expected returns on these stocks are 10 percent and 16 percent, respectively, what is the expected return on the portfolio? Multiple Choice Ο Ο Ο Ο Ο Ο Ο Ο Ο Σ

  • You have $16,600 to invest and would like to create a portfolio with an expected return...

    You have $16,600 to invest and would like to create a portfolio with an expected return of 10.65 percent. You can invest in Stock K with an expected return of 9.6 percent and Stock L with an expected return of 132 percent. How much will you invest in Stock K? Multiple Choice Ο Ο $4,84167 Ο Ο Ο S175833 Ο 46 45556

  • this is my last question I have for this month and I really need these answered!...

    this is my last question I have for this month and I really need these answered! thank you!!! You have a portfolio that is invested 21 percent in Stock R, 36 percent in Stock S, and the remainder in Stock T. The beta of Stock R is .74, and the beta of Stock S is 1.29. The beta of your portfolio is 1.17. What is the beta of the Stock T? Multiple Choice Ο Ο Ο Ο Ο You have...

  • Tom O'Brien has a 2-stock portfolio with a total value of $100,000 $47.500 is invested in Stock A with a beta...

    Tom O'Brien has a 2-stock portfolio with a total value of $100,000 $47.500 is invested in Stock A with a beta of 0.75 and the remainder is invested in Stock B with a beta of 1.42. What is his portfolio's beta? Do not round your intermediate calculations. Round your final answer to 2 decimal places. a. 1.06 O b. 1.05 . c. 1.09 • O d. 1.10 OOO oooo.. o. Click here to read the eBook: The Relationship Between Risk...

  • You own a portfolio that has a total value of 120,000 dollars. The portfolio has 4,000 shares of ...

    You own a portfolio that has a total value of 120,000 dollars. The portfolio has 4,000 shares of stock A, which is priced at 8.7 dollars per share and has an expected return of 8.12 percent. The portfolio also has 10,000 shares of stock B, which has an expected return of 16.94 percent. The risk-free return is 5 percent and inflation is expected to be 2.66 percent. What is the risk premium for your portfolio? Answer as a rate in...

  • You own a portfolio that has a total value of 134,000 dollars. The portfolio has 6,000...

    You own a portfolio that has a total value of 134,000 dollars. The portfolio has 6,000 shares of stock A, which is priced at 7.1 dollars per share and has an expected return of 10.62 percent. The portfolio also has 10,000 shares of stock B, which has an expected return of 14.15 percent. The risk-free return is 4.74 percent and inflation is expected to be 2.93 percent. What is the risk premium for your portfolio? Answer as a rate in...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT