Assume your portfolio consists of 50% of a stock with a beta of 0.275 and 50% of a stock with a beta of 1.918. For each 1 dollar of your portfolio, how much SP500 index should you short? (enter number only)

Assume your portfolio consists of 50% of a stock with a beta of 0.275 and 50% of a stock with a beta of 1.918. For each 1 dollar of your portfolio, how much SP500 index should you short? (enter number only)

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter2: Risk And Return: Part I

Section: Chapter Questions

Problem 11P

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Concept explainers

Stock Market Indices

Stock indexes are used to compare the price fluctuations of a group of stocks of similar companies, which are combined based on a similar industry or a particular market capitalization limit or type of market. The price comparison is based on a pre-determined standard method or indicators. These stock indexes are usually considered a base for comparison of a particular stock, and the performance of that particular company can be easily determined.

Question

Assume your portfolio consists of 50% of a stock with a beta of 0.275
and 50% of a stock with a beta of 1.918. For each 1 dollar of your
portfolio, how much SP500 index should you short? (enter number only)

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