Question

You buy 105 shares of Tidepool Co. for $45 each and 205 shares of​ Madfish, Inc., for $11 each. What are the weights in your​ portfolio?

Answer 1

Answer:

67.96% , 32.31%

Explanation:

105 shares of Tidepool is bought for $45 each

205 shares of Madfisg is bought for $11 each

The first step is to calculate the total value in the portfolio

= 105×$45

= $4,725

= 205×$11

= $2,255

Total value of the portfolio= $4,725+$2,255

= $6,980

Therefore, the weights in the portfolio can be calculated as follows

Tidepool corporation

= 105 × $45/$6980

= $4725/$6980

= 0.6796×100

= 67.96%

Madfish incorporation

= 205 × $11/$6980

= $2255/$6980

= 0.3231×100

= 32.31%

Hence the weights in the portfolio are 67.96% and 32.31%