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Beta for a Portfolio

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You have a 2 million portfolio consisting of a 100,000 investment in each of 20 different stocks. The portfolio has a beta equal to 1.1. You are considering selling $100,000 worth of one stock which has a beta equal to 0.9 and using he process to purchase another stock which has a beta equal to 1.4. What will be the new beta of your portfolio following the transaction?

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The solution explains how to calculate the beta for a portfolio

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The beta of a portfolio is the weighted average beta of individual stocks. The weight of each stock in the total ...

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