Invest in the risk-free asset


Problem:      

You want to create a portfolio equally as risky as the market, and you have $500,000 to invest. Information about the possible investments is given below: Asset Investment Beta Stock A $ 146,000 .91 Stocks B $ 134,000 1.36 Stock C 1.51 Risk-free assets.

Required:

Question 1: How much will you invest in Stock C?

Question 2: How much will you invest in the risk-free asset?

Note: Explain all steps comprehensively.

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Finance Basics: Invest in the risk-free asset
Reference No:- TGS0893010

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