Ask Question
19 November, 16:26

A portfolio is consisted of two stocks:$1,000 in stock X and $3,500 in stock Y. The expected return on stock X is 12%, and 6% for stock Y. What is the expected rate of return of this portfolio

+1
Answers (1)
  1. 19 November, 19:06
    0
    Portfolio return = 7.3%

    Explanation:

    The portfolio expected rate of return would be the weighted average expected rate of return

    Weighted average expected rate of return=

    12% * (1000 / (3500+1000) + (3,500 / (1000+3500) * 6% = 0.073333333

    Expected rate of return = 0.073333333 * 100 = 7.3%

    Portfolio return = 7.3%
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “A portfolio is consisted of two stocks:$1,000 in stock X and $3,500 in stock Y. The expected return on stock X is 12%, and 6% for stock Y. ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers