Posted: February 7th, 2016

2. You own a portfolio that has $3400 invested in Stock A and $4100 invested in stock B. If the expected returns on these stocks are 9.5% and 15.2% respectively

I have 2 finance problems which I need help with. I need step by step explanations please. Thanks.

1. A stock has a beta of 1.24. The expected return on the market is 11.5% and the risk free rate is 3.4%. What is the expected rate of return on the stock?

2. You own a portfolio that has $3400 invested in Stock A and $4100 invested in stock B. If the expected returns on these stocks are 9.5% and 15.2% respectively, What is the expected return on the portfolio?