At the beginning of the year, you owned $40,000 of Home Depot, $20,000 of Walmart, $20,000...

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At the beginning of the year, you owned $40,000 of Home Depot, $20,000 of Walmart, $20,000...

At the beginning of the year, you owned $40,000 of Home Depot, $20,000 of Walmart, $20,000 of Starbucks, and $20,000 of Nike. If the annual returns for Home Depot, Walmart, Starbucks, and Nike were 5.00%, 4.85%, 3.00% and -1.50%, respectively. What is your portfolio’s return?

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Answer 1

Answer #1

Solution:

Home depot = $40,000

Walmart = $20,000

Starbucks = $20,000

Nike = $20,000

Total =$1,00,000

Portfolio return = 5.00%*40,000/1,00,000 + 4.85%*20,000/1,00,000 + 3.00%*20,000/1,00,0000 + (-1.50%) *20,000/1,00,000

Portfolio return = 2.00% + 0.97% + 0.6% - 0.3%= 3.27%

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Answer 2

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