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CoursHeroTranscribedText: A portfolio P consists of a assets, with a proportion x, invested in asset 1. / =1.2.....n (so that x, =1). Derive a formula for the portfolio beta, Op , in terms of the individual betas for each asset. 121 (ib) The annual returns R. on this portfolio can be assumed to conform to the single-index model of asset returns. Write down an equation defining this model and show that: var( Rp) = P; var( Ry )+ var(Ep ) where ap denotes the component of the portfolio return that is independent of movements in the market. [3]