Respuesta :
Answer:
the beta of the overall portfolio is 0.79
Explanation:
The computation of the beta of the overall portfolio is as follows;
= Beta of Treasury bills × weight of Treasury bills + beta of market index × weight of market index + beta of mutual fund × weight of mutual fund
= 0 × 1 ÷ 3 + 1 × 1 ÷ 3 + 1.36 × 1 ÷ 3
= 1 ÷ 3 + 1.36 ÷ 3
= 2.36 ÷ 3
= 0.79
Hence, the beta of the overall portfolio is 0.79
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, cash, and marketable securities, as well as closed-end funds and exchange-traded funds. Stocks, bonds, and cash are commonly seen to be the foundation of a portfolio.
The beta of the overall portfolio is 0.79
The computation of the beta of the overall portfolio is as follows;
[tex]\text{Beta of Treasury bills} \times \text{weight of Treasury bills} + \text{beta of market index} \times \text{weight of market index} + \text{beta of mutual fund} \times \text{weight of mutual fund}[/tex]
= [tex]0 \times \frac{1}{3}+ 1 \times \frac{1}{3} + 1.36 \times \frac{1}{3}[/tex]
= [tex]\frac{1}{3} + \frac{1.36}{3}[/tex]
= [tex]\frac{2.36}{3}[/tex]
= 0.79
Therefore, the beta of the overall portfolio is 0.79
To know more about the beta of the overall portfolio, refer to the link below:
https://brainly.com/question/14345205
