Find beta of new portfolio
Not what you're looking for?
You hold a diversified portfolio consisting of a $10,000 investment in each of 15 different common stocks (i.e., your total investment is $150,000). The portfolio beta is equal to 0.9. You have decided to sell one of your stocks which has a beta equal to 0.6 for $10,000. You plan to use the proceeds to purchase another stock which has a beta equal to 1.3. What will be the beta of the new portfolio? Show your answer to 2 decimal places.
Purchase this Solution
Solution Summary
This solution illustrates how to find the beta of a new portfolio when one security is substituted for another.
Purchase this Solution
Free BrainMass Quizzes
Basics of corporate finance
These questions will test you on your knowledge of finance.
SWOT
This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.
Operations Management
This quiz tests a student's knowledge about Operations Management
Accounting: Statement of Cash flows
This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.
Social Media: Pinterest
This quiz introduces basic concepts of Pinterest social media