Mark owns the following portfolio of securities. what is the beta for the portfolio?
company beta percent of portfolio
amerigas 0.75 10%
atlantic industries 1.00 55%
tgis restaurants 1.55 35%

1.1675

Explanation:

The computation of the portfolio beta is shown below:

= Stock Amerigas portfolio percentage × stock Amerigas  beta + Stock Atlantic Industries portfolio percentage × stock Atlantic Industries beta  + Stock TGIS Restaurants portfolio percentage × stock TGIS Restaurants beta

= 0.10 × 0.75 + 0.55 × 1 + 0.35 × 1.55

= 0.075 + 0.55 + 0.5425

= 1.1675

We simply multiplied the portfolio percentage with its beta

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