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 |
$ |
134,000 |
|
.79 |
| Stock B |
|
146,000 |
|
1.24 |
| Stock C |
|
1.39 |
| Risk-free asset |
|
|
|
a) How much will you invest in Stock C? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Investment in Stock C $
b) How much will you invest in the risk-free asset? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Investment in risk-free asset $