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Expected return of portfolio

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Your portfolio has three asset classes, U.S. government T-bills account for 45% of the portfolio, large-company stocks constitute another 40%, and small-company stocks make up the remaining 15%. If the expected returns are 3.8% for the T-bills, 12.4% for the large-company stocks, and 17.5% for the small-company stocks, what is the expected return of the portfolio?

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Solution Summary

The solution examines the expected return of portfolio assets. The portfolio has three asset classes.

Solution provided by:
Gaurav Agarwal, MS
Education
  • BE, Bangalore University, India
  • MS, University of Wisconsin-Madison
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