Question
You are going to invest $20,000 in a portfolio consisting of assets X, Y, and Z as follows: Asset X: Annual return-10% Probability-0.50 Beta- 1.2
You are going to invest $20,000 in a portfolio consisting of assets X, Y, and Z as follows:
Asset X: Annual return-10% Probability-0.50 Beta- 1.2 Proportion- 0.333
Asset Y: Annual Return-8% Probability-0.25 Beta- 1.6 Proportion- 0.333
Asset Z: Annual Return- 16% Probability- 0.25 Beta 2.0 Proportion- 0.333
Given the information, what is the expected annual rate of return of this portfolio? What is the beta of the portfolio in the table (containing X, Y, and Z)?
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Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert J. Hughes, Arshad Ahmad, Jordan Fortino
6th Canadian edition
1259453146, 978-1259453144
