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You want to create a portfolio equally as risky as the market, and you have $1,000,000 to invest. Given the information below, what is the
You want to create a portfolio equally as risky as the market, and you have $1,000,000 to invest. Given the information below, what is the amount of investment for stock B?
Asset | Investment | Beta |
Stock A | $500,000 | 1.2 |
Stock B | ? | 0.8 |
Market index fund | $160,000 | ? |
Risk-free asset | ? | ? |
a) $300,000
b) $320,000
c) $250,000
d) $240,000
e) $275,000
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