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What are the portfolio weights for a portfolio that has 130 shares of Stock A that sell for $40 per share and 110 shares of Stock B that sell for $30 per share
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What are the portfolio weights for a portfolio that has 130 shares of Stock A that sell for $40 per share and 110 shares of Stock B that sell for $30 per share

User Teun Kooijman
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1 Answer

8 votes

Answer:portfolio Weight of A =0.6118; portfolio Weight of B=0.3882

Step-by-step explanation:

stock A Investment = Number of shares x market value

=130 x 40 = $5200

stock B investment =Number of shares x market value

110 x 30 = $3,300

Total Investments= $5200 + $3,300 = $8,500

portfolio Weight = stock Investment / Total investment

portfolio Weight of A= 5200/ 8,500 =0.6118

portfolio Weight of B = 3,300 / 8,500 =0.3882

User Sofie
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