Calculate expected return

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You own a portfolio that has $1,700 invested in Stock A and $2,800 invested in Stock B. Assume the expected returns on these stocks are 12 percent and 18 percent, respectively. What is the expected return on the portfolio?

Calculate expected return.

State of Economy Probability of State Rate of Return

of Economy if State Occurs

Recession .19 -.09

Normal .45 .11

Boom .36 .30

You own a portfolio equally invested in a risk-free asset and two stocks. One of the stocks has a beta of 1.24 and the total portfolio is equally as risky as the market. What must the beta be for the other stock in your portfolio?

A stock has an expected return of 11.3 percent, its beta is .88, and the risk-free rate is 5.65 percent. What must the expected return on the market be?

Reference no: EM132386139

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