Calculating Portfolio Weights and Expected Returns
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1. What are the portfolio weights for a portfolio that has 145 shares of stock A that sells for $45 per share and 110 shares of Stock B that sells for $27 per share?
2. A portfolio has $2,950 invested in Stock A and $3,700 in Stock B. If the expected returns on these stocks are 8% and 11% respectively, what is the expected return on the portfolio?
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Solution Summary
Solutions depict the methodology to calculate portfolio weights and expected returns in the given cases.
Solution Preview
Solution in excel format is attached.
Problem 1:
Value of Stock A=Va=145*45=$6,525
Value of Stock B=Vb=110*27=$2,970
Total value ...
Education
- BEng (Hons) , Birla Institute of Technology and Science, India
- MSc (Hons) , Birla Institute of Technology and Science, India
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