You have $150,000 invested in three stocks as follows: Stock Investment Stock's Beta SYK $50,000 1.9 ISRG $50,000 1.2 YUM $50,000 (a) What is the beta value of your portfolio? (b) You desire a portfolio of 1.15 and will achieve this by selling $25,000 of ISRG and an additional amount SYK, with the proceeds of both sales to purchase YUM. What dollar amount of SYK should you sell? What dollar amount of YUM will you purchase? 0.9

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
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You have $150,000 invested in three stocks as follows:
Stock
Investment
Stock's Beta
SYK
$50,000
1.9
ISRG
$50,000
1.2
YUM
$50,000
(a)
What is the beta value of your portfolio?
(b) You desire a portfolio of 1.15 and will achieve this by selling $25,000 of ISRG and an additional amount
SYK, with the proceeds of both sales to purchase YUM. What dollar amount of SYK should you sell? What
dollar amount of YUM will you purchase?
0.9
Transcribed Image Text:You have $150,000 invested in three stocks as follows: Stock Investment Stock's Beta SYK $50,000 1.9 ISRG $50,000 1.2 YUM $50,000 (a) What is the beta value of your portfolio? (b) You desire a portfolio of 1.15 and will achieve this by selling $25,000 of ISRG and an additional amount SYK, with the proceeds of both sales to purchase YUM. What dollar amount of SYK should you sell? What dollar amount of YUM will you purchase? 0.9
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