John invested the following amounts in three stocks: Security Investment Beta Stock A $488,268 2.45 Stock...

Question

Question

John invested the following amounts in three stocks:

Calculate the beta portfolio.

Answer 1

Answer #1

Total of investment = 488268 + 796341 + 468348 = 1752957

Now,

Beta of portfolio = Stock A * Stock A beta / Total investment + Stock B * Stock B beta / Total investment + Stock C * Stock C beta / Total investment

Beta of portfolio = 488268 * 2.45 / 1752957 + 796341* 1.87 / 1752957 + 468,348*2.18 / 1752957

Beta of portfolio = 0.682422102 + 0.849511808 + 0.582443631

Beta of the portfolio = 2.11437754

Beta of the portfolio = 2.11

Answer 2

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