Question
1) You hold 4 stocks in your portfolio: A,B,C,D. The portfolio beta is 1.20. Stock C compromises 40% of the dollar value of your holdings
1) You hold 4 stocks in your portfolio: A,B,C,D. The portfolio beta is 1.20. Stock C compromises 40% of the dollar value of your holdings and has a beta of 1.60. If you sell all your holdings in stock C, and replace it with an equal investment in Stock E, (which has a beta of 1.25) what will be you new portfolio beta?
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A First Course in Quantitative Finance
Authors: Thomas Mazzoni
1st edition
9781108411431, 978-1108419574
