Question
You are considering how to invest part of your retirement savings.You have decided to put $200 000 into three shares: 67% of the money in
You are considering how to invest part of your retirement savings.You have decided to put $200 000 into three shares: 67% of the money in Minerva (currently
$29/share), 21% of the money in Baumann (currently $79/share), and the remainder in Martin Associates (currently $3/share). Suppose Minerva shares go up to
$31/share, Baumann shares drop to $62/share, and Martin Associates shares rise to $15 per share.
a. What is the new value of the portfolio?
b. What return did the portfolio earn?
c. If you don't buy or sell any shares after the price change, what are your new portfolio weights?
a. What is the new value of the portfolio?
The new value of the portfolio is $_______ (Round to the nearest dollar.)
b. What return did the portfolio earn?
The portfolio earned a return of ________%. (Round to two decimal places.)
c. If you don't buy or sell any shares after the price change, what are your new portfolio weights?
If you don't buy or sell any shares after the price change, the weight of Minerva is now ________%. (Round to two decimal places.)
The weight of Baumann is now _______%. (Round to two decimal places.)
The weight of Martin is now _______%.(Round to two decimal places.)
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