Question

Marco owns the following portfolio of stocks. What is the expected return on his portfolio?

Stock L- Amount invested :2400 Return on Stock: 6%
Stock M- Amount Invested 10,000 Return on Stock 7.5%
Stock N - Amount Invested 3600 Return on Stock 12.6%
A) 4.7% B) 6.6% C) 8.4% D) 8.7%

Answer 1

Total investment = 2,400+10,000+3,600=16,000

Expected return on Portfolio= 2,400/16,000*6=0.9%+

10,000/16,000*7.5=4.6875% +

3,600/16,000*12.6=2.835%

Expected return on portfolio= 8.4225%

Step-by-step explanation: