Consider a threestock portfolio consisting of stocks G, H, and I with expected returns of 12, 20,
Question:
Consider a three‐stock portfolio consisting of stocks G, H, and I with expected returns of 12, 20, and 17 percent, respectively. Assume that 50 percent of investable funds are invested in security G, 30 percent in H, and 20 percent in I. The expected return on the portfolio is
E(Rp) = 0.5(12%) + 0.3(20%) + 0.2(17%) = 15.4%
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Related Book For
Investments Analysis And Management
ISBN: 9781118975589
13th Edition
Authors: Charles P. Jones, Gerald R. Jensen
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