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Portfolio Return Consider an investor who just made a portfolio consisting of 1 0 0 shares of PNM Resources stock ( PNM ) and 1
Portfolio Return
Consider an investor who just made a portfolio consisting of shares of PNM Resources stock PNM and
shares of Exxon Mobile stock XOM when PNM was worth $ per share and XOM was $ per share.
Suppose a year later, the PNM price rises to $ per share, and the XOM price rises to $ per share.
a Find the rate of return on each of the two stocks.
b Find the fraction of total investment held in each of the two stocks.
c What is the return on the portfolio?
d How much is the portfolio worth in year one?
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