Question
You want a portfolio as risky as the market. Given the information below, compute the weight of the risk-free asset. Enter your answer in percentages,
You want a portfolio as risky as the market. Given the information below, compute the weight of the risk-free asset.
Enter your answer in percentages, rounded off to two decimal points. Do not enter % in the answer box.
| Asset | Investment | Beta |
| Stock A | 40.00% | 1.4 |
| Stock B | 25.00% | 0.9 |
| Stock C | ? | 2.25 |
| Risk-free asset | ? | ? |
Step by Step Solution
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Knowing the total portfolio value and the investment of two stocks in the ...
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Introduction to Finance Markets, Investments and Financial Management
Authors: Ronald W. Melicher, Edgar A. Norton
16th edition
1119398282, 978-1-119-3211, 1119321115, 978-1119398288
