Consider an Investor Who Owns Three Assets: Asset 1, Asset

question 32

Multiple Choice

Consider an investor who owns three assets: asset 1, asset 2, and asset 3 and invests equally in each of the three assets. If the beta of asset 1 is 1.2, the beta of asset 2 is 1.5 and the Beta of asset 3 is zero, then what is the beta of the investor's portfolio.

• A) 0.75
• B) 0.90
• C) 1.10
• D) 1.25

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