Finance

Basic 1.The portfolio burthen of an summation is total investment in that addition divided by the total portfolio encourage. First, we will stripping the portfolio value, which is: re spirite value = 95($53) + 120($29) = $8,515 The portfolio weight for each stock is: WeightA = 95($53)/$8,515 = .5913 WeightB = 120($29)/$8,515 = .4087 2.The tag mother of a portfolio is the sum of the weight of each asset time the judge die of each asset. The total value of the portfolio is: heart value = $1,900 + 2,300 = $4,200 So, the anticipate outlet of this portfolio is: E(Rp) = ($1,900/$4,200)(0.10) + ($2,300/$4,200)(0.15) = .1274 or 12.74% 3.The anticipate drive home of a portfolio is the sum of the weight of each asset propagation the pass judgment remember of each asset. So, the expected return of the portfolio is: E(Rp) = .40(.11) + .35(.17) + .25(.14) = .1385 or 13.85% 4.Here we are given the expected return of the portfolio and th e expected return of each asset in the portfolio and are asked to knock the weight of each asset. We can use the equation for the expected return of a portfolio to mould this problem. Since the total weight of a portfolio must equal 1 (100%), the weight of buy in Y must be one minus the weight of hackneyed X. Mathematically speaking, this means: E(Rp) = .129 = .16wX + .

10(1 wX) We can now solve this equation for the weight of investment firm X as: .129 = .16wX + .10 .10wX .029 = .06wX wX = 0.4833 So, the sawhorse aggregate invested in Stock X is the weight of Stock X times the total portfolio value, or: inve stment cash in X = 0.4833($10,000) = $4,833! .33 And the dollar amount invested in Stock Y is: Investment in Y = (1 0.4833)($10,000) = $5,166.67 5.The expected return of an asset is the sum of the probability of each return occurring times the probability of that return occurring. So, the expected return of the asset is: E(R) = .2(.09) + .5(.11) + .3(.23) =...If you necessitate to get a full essay, order it on our website: BestEssayCheap.com

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