Find the portfolio beta, My portfolio is invested equally

Find the portfolio beta

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Reference no: EM1355562

My portfolio is invested equally in five stocks (that is, each stock in the portfolio has a weight of 0.20) and has a required return of 9.4%. The risk-free rate is 5% and the market risk premium is 4%. What is the portfolio beta? Assume the my portfolio is on the SML.

Choose 1 of the following:
A. 0.950
B. 1.400
C. 0.800
D. 1.100
E. 1.550

The last stock was added to this portfolio is Lauren Clothing Co, which has a beta of 1.50. What was the portfolio's beta before Lauren's stock was added? (Hint: Remember that is was a four stock portfolio before the last stock was added.)

Choose 1 of the following:
A. 1.150
B. 1.000
C. 1.250
D. 1.175
E. 1.025

Reference no: EM1355562

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