When a portfolio comprises investment in three shares (Share A — 40%, Share B — 25% and Share C — 35%) whose beta factors are 1.3, 1.6 and 1.2, respectively, the portfolio beta is :

CS Executive · Financial and Strategic Management · PYQS · December 2020
When a portfolio comprises investment in three shares (Share A — 40%, Share B — 25% and Share C — 35%) whose beta factors are 1.3, 1.6 and 1.2, respectively, the portfolio beta is :
(A) 1.34
(B) 1.43
(C) 1.24
(D) 1.42

Answer & Explanation:

Correct Answer: Option (A)

Official answer key: (A).

Topics: Financial Management

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