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You've assembled the following portfolio: Stock Beta Portfolio weight 1 1.3 0.4 2 1.1 0.2 3 0.6 0.4 The expected market return is 8% and

You've assembled the following portfolio:

Stock	Beta	Portfolio weight
1	1.3	0.4
2	1.1	0.2
3	0.6	0.4

The expected market return is 8% and the risk-free rate is 2%. Assume that the CAPM holds.

Part 1

What is the beta of the portfolio?

Part 2

What is the expected return of your portfolio?

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