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Social ScienceYou own $25,080 of Human Genome stock that has a beta of 3.72. You also own $13,376 of Frozen Food Express (beta = 1.87) and $3,344 of Molecular Devices (beta = 0.46).What is the beta of your portfolio? (Round your answer to 2 decimal places.)Portfolio beta: ___.__%
You own $25,080 of Human Genome stock that has a beta of 3.72. You also own $13,376 of Frozen Food Express (beta = 1.87) and $3,344 of Molecular Devices (beta = 0.46).
What is the beta of your portfolio? (Round your answer to 2 decimal places.)
Portfolio beta: ___.__%
Expert Answer
To determine the portfolio beta we first need to calculate the weights of each investment.
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Total portfolio value=Sum of all the individual investments -25080+13376+3344=41800
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Weight of Human Genome stock in the portfolio (Amount invested) (Portfolio value) -25080 41800-0.6 Weight of Frozen Food Express stock in the portfolio-(Amount invested) (Portfolio value) -13376 41800-0.32 Weight of Molecular Devices stock in the portfolio-(Amount invested) (Portfolio value) 3344 41800-0.08
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