Travis has a portfolio consisting of two stocks, A and B, which is valued at $23,932. Stock A is worth $13,230. What is the portfolio weight of Stock B?
A).428
B).443
C).447
D).453
E).461

Question

Quizplus · Accepted Answer

To find the portfolio weight of Stock B, we need to divide the value of Stock B by the total value of the portfolio.

Portfolio value = $23,932 
Value of Stock A = $13,230

Value of Stock B = Portfolio value - Value of Stock A 
Value of Stock B = $23,932 - $13,230 
Value of Stock B = $10,702

Portfolio weight of Stock B = Value of Stock B / Portfolio value 
Portfolio weight of Stock B = $10,702 / $23,932 
Portfolio weight of Stock B = 0.447 or 44.7%

Therefore, the answer is C).447.

Travis Has a Portfolio Consisting of Two Stocks, a and B