In: Finance
If you own $20,000 of stock A and $20,000 of stock B, and Stock A has an expected return of 35% while stock B has an expected return of 15%, what is the expected return of the portfollio?
Ans 25.00%
Stock | Investment (i) | Return (ii) | Investment*Return (i)* (ii) |
A | 20,000.00 | 35% | 7,000.00 |
B | 20,000.00 | 15% | 3,000.00 |
Total | 40,000.00 | 10,000.00 | |
Expected Return = | (Investment * Return) / Investment * 100 | ||
10000 / 40000 * 100 | |||
25.00% |