Fremont Enterprises has an expected return of 16% and Laurelhurst News has an ex

Question

Fremont Enterprises has an expected return of 16% and Laurelhurst News has an expected return of 20%. If you put 58% of your portfolio in Laurelhurst and 42% in Fremont, what is the expected return of your portfolio?

Fremont Enterprises has an expected return of 16% and Laurelhurst News has an expected return of 20%. If you put 58% of your portfolio in Laurelhurst and 42% in Fremont, what is the expected return of your portfolio? The expected return on the portfolio is %. (Rounded to two decimal places.)

Explanation / Answer

expected return of portfolio=Respective returns*Respective weights

=(16*0.42)+(20*0.58)

=18.32%

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