What is the expected return on this portfolio? Stock Expected Return Number of s

Question

What is the expected return on this portfolio?

Stock                           Expected Return                  Number of shares              stock price

A                                        8%                                            520                             $25

B                                       15%                                           300                             $48

C                                        6%                                             250                            $26

Explanation / Answer

Expected return =

( 8 * 520 + 15 * 300 + 6 * 250 ) / ( 520 + 300 + 250 )

= 9.495%

i.e 9.5%

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