Example suppose you invest 50 of your portfolio in

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Unformatted text preview: of n stocks is: n (28) Portfolio return ¦w r ii i1 Where wi denotes the fraction of the portfolio invested in stock i and r i is the expected return on stock i. Example: - Suppose you invest 50% of your portfolio in Nokia and 50% in Nestlé. The expected return on your Nokia stock is 15% while Nestlé offers 10%. What is the expected return on your portfolio? - Portfolio return n ¦w r ii 0.5 ˜ 15%  0.5 ˜ 10% 12.5% i1 - A portfolio with 50% invested in Nokia and 50% in Nestlé has an expected return of 12.5%. Please click the advert Fast-track your career Masters in Management Stand out from the crowd Designed for graduates with less than one year of full-time postgraduate work experience, London Business School’s Masters in Management will expand your thinking and provide you with the foundations for a successful career in business. The programme is developed in consultation with recruiters to provide you with the key skills that top employers demand. Through 11 months of full-time study, you will gain the business knowledge and capabilities to inc...
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