You own a portfolio that has a total value of $175,000 and it is invested in...

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Finance

You own a portfolio that has a total value of $175,000 and it isinvested in Stock D with a beta of .89 and Stock E with a beta of1.31. The beta of your portfolio is equal to the market beta. Whatis the dollar amount of your investment in Stock D?
Choices:
$40,104.17
$22,917.11
$34,375.22
$129,166.67
$45,833.33

Answer & Explanation Solved by verified expert

3.7 Ratings (414 Votes)

Solution As per the information given in the question we have Beta of stock D 089 Beta of Stock E 131 Given that the Beta of the portfolio is equal to the market Beta 1 Total value of investment in Portfolio 175000 To find dollar value of investment in Stock See Answer

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Transcribed Image Text

You own a portfolio that has a total value of $175,000 and it isinvested in Stock D with a beta of .89 and Stock E with a beta of1.31. The beta of your portfolio is equal to the market beta. Whatis the dollar amount of your investment in Stock D?Choices:$40,104.17$22,917.11$34,375.22$129,166.67$45,833.33