Question

At the beginning of the month, you owned $10,600 of Company G, $10,500 of Company S, and $16,000 of Company N. The monthly returns for Company G, Company S, and Company N were 9.75 percent, -1.30 percent, and 9.30 percent. What is your portfolio return? (Round intermediate calculations to 2 decimal places.)

Answer 1

The portfolio return is approximately 3.07%.

Step-by-step explanation:

To calculate the portfolio return, we need to find the weighted average of the returns of each company based on the initial investments.

First, calculate the total value of the portfolio:

$10,600 + $10,500 + $16,000

= $37,100.

Next, calculate the return for each company:

Company G return = $10,600 * 9.75%

= $1,032.75;

Company S return = $10,500 * -1.30%

= -$136.50;

Company N return = $16,000 * 9.30%

= $1,488.

Finally, calculate the weighted average return:

Total return = ($1,032.75 + -$136.50 + $1,488) / $37,100

= 3.07%.