Respuesta :
The portfolio's anticipated return is 13.60%. The weight of each asset is multiplied by its projected return to determine the expected return.
What is the portfolio's anticipated return?
The entire amount of money an investor anticipates to win or lose on a specific investment or portfolio is known as their expected return. When deciding whether to purchase new investments or keep onto their current holdings, investors frequently use the predicted return as a guide.
In the given question,
Total stock amount = $8000 + $6000 + $4000 + $2000
Total stock amount = $20000
The sum of each individual predicted return weighted by its weight in capital determines the performance of a portfolio.
Weight of each section = Stock amount / Total stock amount
Weight (apple) = 8000 / 20000
Weight (apple) = 0.4
Weight (Microsoft) = 6000 / 20000
Weight (Microsoft) = 0.3
Weight (ford) = 4000 / 20000
Weight (ford) = 0.2
Weight (time warner) = 2000 / 20000
Weight (time warner) = 0.1
Expected return of the portfolio = (0.1050 * 0.4) + (0.1690 * 0.3) + (0.1575 * 0.2) + (0.1180 * 0.1)
Expected return of the portfolio = 0.042 + 0.0507 + 0.0315 + 0.0118
Expected return of the portfolio = 0.136 = 13.60%
In conclusion, the expected return of the portfolio is 13.60%
Learn more about expected return of the portfolio: https://brainly.com/question/13576560
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