Homework Answers
Amount invested in stock1 = $20000 Beta1 = 0.7
Amount invested in stock2 = $55000 Beta2 = 1.7
Weight of stock1 = 20000/75000 = 0.26666
Weight of stock2 = 55000/75000 = 0.73333
Portfolio Beta = Weight of stock1 * Beta1 + Weight of stock2 * Bata2
= 0.26666 * 0.7 + 0.73333*1.7
Portfolio Beta = 1.43333 Answer
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