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Calculate the expected beta of the portfolio

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Reference no: EM132979646

Problem 1: Suppose you use $1 000 000 to construct a portfolio comprising stocks A and B such that you invest $600 000 in A and $400 000 in B. Also, you have done some research and estimated the beta of the stocks to be A = 1.5 and B = 0.75. Use expected returns calculated for each stock in A., above to calculate the expected:

i. return on the portfolio.

ii. beta of the portfolio.

Reference no: EM132979646

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