Question

Fremont Enterprises has an expected return of 12% and Laurelhurst News has an expected return of 19 . If you put 44 of your portfolio in Laurelhurst and 56

in​ Fremont, what is the expected return of your​ portfolio?

Answer 1

To calculate the expected return of your portfolio, multiply the amount invested in each asset by their respective expected returns and sum them up. In this case, the expected return of your portfolio would be 15.08%.

Step-by-step explanation:

To calculate the expected return of your portfolio, we need to multiply the amount invested in each asset by their respective expected returns and then sum them up.

In this case, you have invested 44% of your portfolio in Laurelhurst with an expected return of 19%, and 56% of your portfolio in Fremont with an expected return of 12%.

So, the expected return of your portfolio can be calculated as: (44% x 19%) + (56% x 12%) = 8.36% + 6.72% = 15.08%