Julia invested a $120,000 inheritance into two different portfolios listed below ($80000 in portfolio #1 and $40,000 in portfolio #2). Portfolio #1 Type of investment Return after 1 year 7% growth 13% growth 21% growth 20% in corporate bonds 25% in income stocks 15% in growth stocks 10% in penny stocks (speculative stocks) Remainder in a 10-year certificate of deposit(CD) 77% decline 2% growth Portfolio #2 Return after 1 year 6% growth 15% growth 28% growth Type of investment 20% in corporate bonds 25% in income stocks 30% in grovrih stocks 15% in penny stocks (speculative stocks) Remainder in a 10-year certificate of deposit(CD) 64% decline 2% growth 1. Identify the percentage gain/loss and the monetary gain/loss for each portfolio. 2. Why do you think Julia may have split the amount of money in each portfolio in the way she did. 3. What is the total percentage gain/loss and monetary gain/loss for the entire inheritance.
Julia invested a $120,000 inheritance into two different portfolios listed below ($80000 in portfolio #1 and $40,000 in portfolio #2). Portfolio #1 Type of investment Return after 1 year 7% growth 13% growth 21% growth 20% in corporate bonds 25% in income stocks 15% in growth stocks 10% in penny stocks (speculative stocks) Remainder in a 10-year certificate of deposit(CD) 77% decline 2% growth Portfolio #2 Return after 1 year 6% growth 15% growth 28% growth Type of investment 20% in corporate bonds 25% in income stocks 30% in grovrih stocks 15% in penny stocks (speculative stocks) Remainder in a 10-year certificate of deposit(CD) 64% decline 2% growth 1. Identify the percentage gain/loss and the monetary gain/loss for each portfolio. 2. Why do you think Julia may have split the amount of money in each portfolio in the way she did. 3. What is the total percentage gain/loss and monetary gain/loss for the entire inheritance.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Transcribed Image Text:Julia invested a $120,000 inheritance into two different portfolios listed below ($80000 in portfolio #1 and $40,000 in
portfolio #2).
Portfolio #1
Return after 1 year
Type of investment
20% in corporate bonds
25% in income stocks
7% growth
13% growth
21% growth
15% in growth stocks
10% in penny stocks (speculative
stocks)
Remainder in a 10-year certificate of
deposit(CD)
77% decline
2% growth
Portfolio #2
Return after 1 year
6% growth
15% growth
28% growth
Type of investment
20% in corporate bonds
25% in income stocks
30% in grovrih stocks
15% in penny stocks (speculative stocks)
Remainder in a 10-year certificate of deposit(CD)
64% decline
2% growth
1. Identify the percentage gain/loss and the monetary gain/loss for each portfolio.
2. Why do you think Julia may have split the amount of money in each portfolio in the way she did.
3. What is the total percentage gain/loss and monetary gain/loss for the entire inheritance.
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