Assume that two securities a and b constitute the market, Financial Management

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Assume that two securities a and b constitute the market

Assume that two securities, A and B, constitute the market portfolio (i.e. the market portfolio contains only these two stocks). The market portfolio's weight on stock A is 39% and its weight on stock B is 61%. The variance of stock A is 0.016, and variance of stock B is 0.034, and the covariance between stock A and B is 0.019.

-Compute the betas of stock A and B.

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Financial Management: Assume that two securities a and b constitute the market

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