The following three stocks are available in the market:

	E(R)
Stock A	10.9	%	1.31
Stock B	14.1		1.11
Stock C	16.6		1.51
Market	14.5		1.00
Assume the market model is valid. The return on the market is 15.3 percent and there are no unsystematic surprises in the returns. What is the return on each stock?

Return Stock A % Stock B % Stock C % Assume a portfolio has weights of 25 percent Stock A, 40 percent Stock B, and 35 percent Stock C. The return on the market is 15.3 percent and there are no unsystematic surprises in the returns. What is the return on the portfolio?

Return on the portfolio

%