Answer: 1.211
Explanation:
From the question, we are informed that an individual own a stock portfolio invested 25 percent in Stock Q, 20 percent in Stock R, 10 percent in Stock S, and 45 percent in Stock T and that the betas for these four stocks are 1.32, 1.26, 1.52, and 1.06, respectively.
The portfolio beta will be calculated as:
= (shares of Q × Beta of Q) + (shares of R × Beta R) + (shares of S × Beta S) + (shares of R * Beta T))/ Total Shares
=(25 × 1.32) + (20 × 1.26) + (10 × 1.52) + (45 × 1.06)/100
= (33 + 25.2 + 15.2 + 47.7) / 100
= 121.1/100
= 1.211
