Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Given the following information about the returns of stocks A, B, and C, what is the expected return of a portfolio invested 30% in stock

Given the following information about the returns of stocks A, B, and C, what is the expected return of a portfolio invested 30% in stock A, 40% in stock B, and 30% in stock C?

State of economy Probability Stock A Stock B Stock C
Boom 0.14 0.31 0.39 0.32
Good 0.25 0.19 0.13 0.16
Poor 0.29 0.08 0.06 0
Bust -- -0.22 -0.22 -0.2

Enter answer in percents.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

New Issues In Financial Institutions Management

Authors: F Fiordelisi, P Molyneux, D Previati

2010th Edition

0230278108, 978-0230278103

More Books

Students also viewed these Finance questions