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3. Portfolio betas (S8.1) A portfolio contains equal investments in 10 stocks. Five have a beta of 1.2; the remainder have a beta of 1.4.

3. Portfolio betas (S8.1) A portfolio contains equal investments in 10 stocks. Five have a beta of 1.2; the remainder have a beta of 1.4. What is the portfolio beta? A. 1.3. B. Greater than 1.3 because the portfolio is not completely diversified. C. Less than 1.3 because diversification reduces beta.
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3. Portfolio betas (S8.1) A portfolio contains equal investments in 10 stocks. Five have a beta of 1.2 ; the remainder have a beta of 1.4 . What is the portfolio beta? A. 1.3. B. Greater than 1.3 because the portfolio is not completely diversified. C. Less than 1.3 because diversification reduces beta

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