Question

In: Finance

You have a $100,000 portfolio consisting only of Facebook, Netflix, and Tesla stocks. You put $30,000...

You have a $100,000 portfolio consisting only of Facebook, Netflix, and Tesla stocks. You put $30,000 in Facebook, $20,000 in Netflix, and the rest in Tesla. Their respective betas are 1.2, 1.1, and 0.9. Your portfolio beta is .

Please enter your answer with TWO decimal points.

Solutions

Expert Solution

Calculation of portfolio beta:

Particulars Amount invested Proportion (1) Beta (2) Portfolio Beta (3) (1*2)
Facevalue 30,000 30,000/100,000=0.3 1.2 0.36
Nerflix 20,000 20,000/100,000=0.2 1.1 0.22
Tesla 50,000 50,000/100,000=0.5 0.9 0.45
100,000 Portfolio Beta 1.03

Portfolio Beta = 1.03


Related Solutions

You have a portfolio worth $100,000 consisting of two stocks, A and B. You invested $30,000...
You have a portfolio worth $100,000 consisting of two stocks, A and B. You invested $30,000 in stock A and the remainder in Stock B. Consider the following information: Type your answers in the appropriate section showing all steps of your work State of the Economy Probability Of State Return on A Return on B Growth 0.25 15% 8% Normal 0.50 5% 20% Recession 0.25 -10% 25%                 Expected return 3.75% ??                                               Standard deviation ??               6.26% a) What is the...
Portfolio Beta You have a $2 million portfolio consisting of a $100,000 investment in each of...
Portfolio Beta You have a $2 million portfolio consisting of a $100,000 investment in each of 20 different stocks. The portfolio has a beta of 1.2. You are considering selling $100,000 worth of one stock with a beta of 1.1 and using the proceeds to purchase another stock with a beta of 1.4. What will the portfolio's new beta be after these transactions? Do not round intermediate calculations. Round your answer to two decimal places.
You own a portfolio consisting of the following stocks:
You own a portfolio consisting of the following stocks: Stock        % of Portfolio        Beta        Historical Return   Required Return 1 13% 1.15 .11 2 44% 0.95 .08   3 19% 1.60 .14   4 24% 1.30 .12 The risk-free rate is 5% and the expected market return is 10%. a. Calculate the required return for each stock.   b. Calculate the historical return on the portfolio.   c. Calculate the portfolio beta. d. Calculate the required return...
11. Portfolio Beta You have a $2 million portfolio consisting of a $100,000 investment in each...
11. Portfolio Beta You have a $2 million portfolio consisting of a $100,000 investment in each of 20 different stocks. The portfolio has a beta of 1.1. You are considering selling $100,000 worth of one stock with a beta of 0.9 and using the proceeds to purchase another stock with a beta of 1.4. What will the portfolio's new beta be after these transactions? Do not round intermediate calculations. Round your answer to two decimal places. 12. Required Rate of...
You have a $2 million portfolio consisting of a $100,000 investment in each of 20 different...
You have a $2 million portfolio consisting of a $100,000 investment in each of 20 different stocks. The portfolio has a beta of 1.05. You are considering selling $100,000 worth of one stock with a beta of 1.15 and using the proceeds to purchase another stock with a beta of 1.3. What will the portfolio's new beta be after these transactions? Do not round intermediate calculations. Round your answer to two decimal places.
1. You have a $30,000 portfolio that consists of equal dollar investments in stocks A, B,...
1. You have a $30,000 portfolio that consists of equal dollar investments in stocks A, B, and C, each with a current price of $25. After one year, stock A is worth $40, stock B is worth $30, and stock C is worth $12.50. You wish to rebalance the portfolio to maintain equal dollar investments in each stock. How many shares of each stock do you buy and/or sell to rebalance the portfolio? A common behavioral hypothesis is that investors...
1.) You have a portfolio consisting of Intel, GE and Con Edison. You put 20% in...
1.) You have a portfolio consisting of Intel, GE and Con Edison. You put 20% in Intel, 65% in GE and 15% in Con Edison. Intel, GE and Con Edison have betas of 0.43, 1.48 and 1.75 respectively. What is your portfolio beta? 2.) According to the CAPM, what is the expected return on a security given a market risk premium of 12%, a stock beta of 1.51, and a risk free interest rate of 1%? Put the answers in...
You have a $77000 portfolio consisting of Intel, GE, and Con Edison. You put $15000 in...
You have a $77000 portfolio consisting of Intel, GE, and Con Edison. You put $15000 in Intel, $14000 in GE, and the rest in Con Edison. Intel, GE, and Con Edison have betas of 1.3, 1.1, and 0.8, respectively. What is your portfolio beta? 1.300 0.451 0.949 0.952
You have a $50000 portfolio consisting of Intel, GE, and Con Edison. You put $17000 in...
You have a $50000 portfolio consisting of Intel, GE, and Con Edison. You put $17000 in Intel, $15000 in GE, and the rest in Con Edison. Intel, GE, and Con Edison have betas of 1.3, 0.9, and 0.8, respectively. What is your portfolio beta? 1.000 1.300 0.984 0.696
You have a $42,000 portfolio consisting of Intel, GE, and Con Edison. You put $22,400 in...
You have a $42,000 portfolio consisting of Intel, GE, and Con Edison. You put $22,400 in Intel, $8,800 in GE, and the rest in Con Edison. Intel, GE, and Con Edison have betas of 1.3, 1, and .8, respectively. What is your portfolio beta? A.1.109 B. 0.941 C. 0.853 D. 1.441
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT