Question
Suppose there are only two risky assets in the entire world, Facebook stock and Apple stock, and also a risk-free asset. Suppose the total market
Suppose there are only two risky assets in the entire world, Facebook stock and Apple stock, and also a risk-free asset. Suppose the total market value of Facebook stock is $8 trillion and the total market value of Apple stock is $4 trillion. If my total portfolio is _______, then my investments are consistent with the separation theorem and plot along the Capital Market Line.
Question 6 options:
None of the strategies in this question plot along the Capital Market Line
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20% in the riskfree asset, 60% in Facebook stock, and 20% in Apple stock
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0% in the riskfree asset, 50% in Facebook stock, and 50% in Apple stock
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25% in the riskfree asset, 50% in Facebook stock, and 25% in Apple stock |
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