Calculate the expected rate of return on the portfolio

Assignment Help Financial Management

Reference no: EM131956681

An investor has a portfolio with 30% invested in gold stocks, and 70% in industrial stocks. \it is expexted that gold stocks will provide 4% return ina good economy and 18% in a poor economy. Industrial stocks are expexted to provide 9% return in a good economy and -9% ina poor economy.

The probability of a good economy is $40% and 60% in a poor economy. given this info calculate the expected rate of return on the portfolio.

Reference no: EM131956681

Questions Cloud

Discuss how nurses use professional communication skills : Discuss how nurses use professional communication skills to develop a therapeutic relationship with patients

If you were looking to buy euro where would you buy it : An investor is examining exchange rates in London and New York. For simplicity, all rates are quoted versus the U.S. dollar.

How developers can be expected to benefit financially : Communities across the nation are grappling with an affordability crisis in terms of housing. High rents and high property values are creating housing cost.

What should current rate be on treasury securities : If the liquidity premium theory is correct, what should the current rate be on 3-year Treasury securities?

Calculate the expected rate of return on the portfolio : The probability of a good economy is $40% and 60% in a poor economy. given this info calculate the expected rate of return on the portfolio.

Why do you need to get a flu shot each year : Why do you need to get a flu shot each year and what is your opinion about getting the flu shot? Is the material written objective and reliable?

Management in implementing the vision : Explain the challenges for top management in implementing the vision, mission, and guiding principles.

What about an aggressive investor : Investors are concerned with holding an optimal portfolio. Consider the choices an investor can make. How will the portfolio choices differ for a conservative.

What would be a simple options strategy : What would be a simple options strategy using a put and a call to exploit your conviction about the stock price's future movement?

User Account

All Pages