Problem
You are holding a portfolio with the following investments and betas:
|
Stock
|
Dollar investment
|
Beta
|
|
A
|
$300,000
|
1.35
|
|
B
|
200,000
|
1.6
|
|
C
|
300,000
|
0.75
|
|
D
|
200,000
|
-0.35
|
|
Total investment
|
1,000,000
|
|
The market's required return is 9% and the risk-free rate is 3%. What is the portfolio's required return?