You own a portfolio that is 27 percent invested in Stock X, 42 percent in Stock

Question

You own a portfolio that is 27 percent invested in Stock X, 42 percent in Stock Y, and 31 percent in Stock Z. The expected returns on these three stocks are 12 percent, 15 percent, and 17 percent, respectively.

What is the expected return on the portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

What is the expected return on the portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

Explanation / Answer

Expected Return on Portfolio = 0.27*0.12 + 0.42*0.15 + 0.31*0.17 = 0.1481 = 14.81%

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