What is the Beta of a three-stock portfolio including 25% of Stock A with a Beta of .90, 40% Stock B with a Beta of 1.25

What is the Beta of a three-stock portfolio including 25% of Stock A with a Beta of .90, 40% Stock B with a Beta of 1.25, and 35% Stock C with a Beta of 1.3?

		1.05
		1.25
		1.18
		1.22

Expert Solution

Ans 1.18

Stock	Investment (i)	Beta (ii)	Investment* Beta (i)* (ii)
A	25.00%	0.90	0.23
B	40.00%	1.25	0.50
C	35.00%	1.30	0.46
		Total	1.18

jeff jeffy answered 2 years ago

what is the beta of a three-stock portfolio including $2500 invested in stock A with a...

what is the beta of a three-stock portfolio including $2500 invested in stock A with a beta of .90, $4000 invested in stock B with a beta of 1.05, and $3500 invested in stock C with beta of 1.73?

stock a has a beta of 1.6 and a standard deviation of 25%. stock b has...

stock a has a beta of 1.6 and a standard deviation of 25%. stock b has a beta of 1.4 and a standard deviation of 20%. portfolio ab was created by investing in a combination of stocks a and b. portfolio ab has a beta of 1.25 and a standard deviation of 18%. which of the following statements is correct? Stock A has more market risk than Portfolio AB. Stock A has more market risk than Stock B but less...

Your portfolio has a beta of 1.25. The portfolio consists of 17 percent U.S. Treasury bills,...

Your portfolio has a beta of 1.25. The portfolio consists of 17 percent U.S. Treasury bills, 29 percent in stock A, and 54 percent in stock B. Stock A has a risk-level equivalent to that of the overall market. What is the beta of stock B? How can I use Excel to Find Beta?

in your two-stock portfolio, you invest $25 in stock a and $75 in stock B. if...

in your two-stock portfolio, you invest $25 in stock a and $75 in stock B. if the beta of stock A is 1.31 and the beta of stock b is 1.39 your portfolio wold be:

Based on the following information, what is the portfolio beta? Stock Value Beta A $47570...

Based on the following information, what is the portfolio beta? Stock Value Beta A $47570 1.14 B $25106 1.88 C $30608 0.72 D $30787 3.38

5. You have been managing a $5million portfolio that has a beta of 1.25 and a...

5. You have been managing a $5million portfolio that has a beta of 1.25 and a required rate of return of 12%. The current risk-free rate is 5.25%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 0.75, what will be the required return on your $5.5 million portfolio? Show work. a. 10.43% b. 11.75% c. 9.62% d. 10.17%

A hedge fund manager has a portfolio worth $50 million with a beta of 1.25. The...

A hedge fund manager has a portfolio worth $50 million with a beta of 1.25. The manager is concerned about the performance of the market over the next two months He plans to uses three-month stock market index futures to hedge his market exposure. The current stock market index level is 2,500 and one contract is on 250 times the futures price. The continuously compounded interest rate is 3% and the dividend yield on the stock market index is 2%....

Portfolio A has $65 million in stock and $45 million in bonds. Portfolio B has $40...

Portfolio A has $65 million in stock and $45 million in bonds. Portfolio B has $40 million in stock and $70 million in bonds. Portfolio manager A makes a swap with portfolio manager B to exchange stock for bonds with a notional principal of $25 million. Year-end returns are as follows. Stock return 4% Bond return 6% A. Show the asset allocation for each portfolio before the swap here; Identify as A or B. Portfolio A Portfolio B Dollars Weights...

Assume the CAPM holds. Portfolio A has a beta of 1.2. Portfolio B has a beta...

Assume the CAPM holds. Portfolio A has a beta of 1.2. Portfolio B has a beta of 2.4. Which of the following is true? none of the answers listed here. the return on Portfolio A is twice the return on portfolio B. The return on Portfolio B is twice the return on Portfolio A. the return on Portfolio A is half the return on portfolio B. 10 points

A mutual fund manager has a $90.0 million portfolio with a beta of 1.25. The risk-free...

A mutual fund manager has a $90.0 million portfolio with a beta of 1.25. The risk-free rate is 3.50%, and the market risk premium is 6.00%. The manager expects to receive an additional $30.0 million which she plans to invest in a number of stocks. After investing the additional funds, she wants to reduce the portfolio’s risk level so that once the additional funds are invested the portfolio’s required return will be 11.75%. What must the average beta of the...

Question