You own a portfolio that has $1,500 invested in Stock A and $2,600 invested in S

Question

You own a portfolio that has $1,500 invested in Stock A and $2,600 invested in Stock B. Assume the expected returns on these stocks are 10 percent and 16 percent, respectively.

What is the expected return on the portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

You own a portfolio that has $1,500 invested in Stock A and $2,600 invested in Stock B. Assume the expected returns on these stocks are 10 percent and 16 percent, respectively.

Explanation / Answer

expected return on the portfolio = W1*R1+W2*R2

=1500/(1500+2600)*10%+2600/(1500+2600)*16%

=0.138049

=13.8049%

=13.80%

ans:13.80%

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