Portfolio Return Year to date,Company Y had earned a 10.8 percent return.During the same time period,Company R earned 12.20 percent and Company C earned -1.56 percent.If you have a portfolio made up of 45 percent Y,35 percent R,and 20 percent C,what is your portfolio return?
A)7.15 percent
B)8.19 percent
C)8.82 percent
D)9.44 percent

Question

Quizplus · Accepted Answer

To calculate your portfolio return, you need to multiply the weighting of each company by their respective returns and then add them up.

Portfolio Return = (Weighting of Y x Return of Y) + (Weighting of R x Return of R) + (Weighting of C x Return of C)

Plugging in the numbers, we get:

Portfolio Return = (0.45 x 10.8%) + (0.35 x 12.2%) + (0.20 x -1.56%)
Portfolio Return = 4.86% + 4.27% - 0.31%
Portfolio Return = 8.82%

Therefore, the answer is C) 8.82 percent.

Portfolio Return Year to Date,Company Y Had Earned a 10