You want to create a portfolio equally as risky as the market, and you have $500,000 to invest. Information about the possible investments is given below: Asset Stock A Stock B Stock C Risk-free asset Investment $138,000 $142,000 Investment in Stock C Beta .83 1.28 1.43 Requirement 1: How much will you invest in Stock C? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) Investment in risk-free W $ Requirement 2: How much will you invest in the risk-free asset? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)
You want to create a portfolio equally as risky as the market, and you have $500,000 to invest. Information about the possible investments is given below: Asset Stock A Stock B Stock C Risk-free asset Investment $138,000 $142,000 Investment in Stock C Beta .83 1.28 1.43 Requirement 1: How much will you invest in Stock C? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) Investment in risk-free W $ Requirement 2: How much will you invest in the risk-free asset? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)
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
Problem 1PS
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Transcribed Image Text:You want to create a portfolio equally as risky as the market, and you have $500,000 to
invest. Information about the possible investments is given below:
Asset
Stock A
Stock B
Stock C
Risk-free asset
Investment
$138,000
$142,000
Beta
.83
1.28
1.43
Investment in
Stock C
Requirement 1:
How much will you invest in Stock C? (Do not round intermediate calculations. Round
your answer to 2 decimal places (e.g., 32.16).)
W
$
Requirement 2:
How much will you invest in the risk-free asset? (Do not round intermediate
calculations. Round your answer to 2 decimal places (e.g., 32.16).)
Investment in risk-free
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