You own three? stocks: 600 shares of Apple? Computer, 10,000shares of Cisco? Systems, and 5,000 shares of? Colgate-Palmolive.The current share prices and expected returns of? Apple, Cisco,and? Colgate-Palmolive are,? respectively, $463?, $22?, $101 and12%?, 10%?, 8%.
a. What are the portfolio weights of the three stocks in your?portfolio?
b. What is the expected return of your? portfolio?
c. Suppose the price of Apple stock goes up by $22?, Cisco risesby $5?, and? Colgate-Palmolive falls by $10. What are the newportfolio? weights?
d. Assuming the? stocks' expected returns remain the? same, whatis the expected return of the portfolio at the new? prices?
