A stock portfolio consists of 27 percent Stock A,38 percent Stock B,and the remainder is invested in Stock C.The security betas are 1.09,0.84,and 1.33 for Stocks A,B,and C,respectively.What is the portfolio beta?

Name: A stock portfolio consists of 27 percent Stock A,38 percent Stock B,and the remainder is invested in Stock C.The security betas are 1.09,0.84,and 1.33 for Stocks A,B,and C,respectively.What is the portfolio beta?
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Question

Quizplus · Accepted Answer

β_P = 0.27(1.09)+ 0.38(0.84)+ (1 - 0.27 - 0.38)(1.33)= 1.079

A Stock Portfolio Consists of 27 Percent Stock A,38 Percent