A portfolio contains four assets.Asset 1 has a beta of .7 and represents 35 percent of the portfolio.Asset 2 has a beta of 1.3 and represents 20 percent of the portfolio.Asset 3 has a beta of 1.1 and is 25 percent of the portfolio.Asset 4 has a beta of 2.16.What is the portfolio beta?
A)1.212
B)1.264
C)1.308
D)1.480
E)1.642

Question

Quizplus · Accepted Answer

βp = .35(.7)+ .20(1.3)+ .25(1.1)+ (1 - .35 - .20 - .25)(2.16)= 1.212

A Portfolio Contains Four Assets