Question
Over the past several weeks you have assembled a small stock portfolio via the purchase of small amounts of different company stocks. You know that
Over the past several weeks you have assembled a small stock portfolio via the purchase of small amounts of different company stocks. You know that the point of a portfolio is to reduce your overall exposure to systematic risk, but aren't sure exactly what the risk of your new portfolio is. You have purchased the following : $4,000 of Tesla Stock, $8,000 of McDonald's Stock, and $2,000 of Boeing Stock. You have estimated the betas of these stocks to be the following : a of 2.99 for Tesla, a of 1.62 for McDonald's, and a of 0.5 for Boeing. What is the beta of your portfolio? (Round to 2 digits)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started