Nico owns 100 shares of Stock X which has a price of $12 per share and 200 shares of Stock Y...

Question:

Nico owns 100 shares of Stock X which has a price of $12 per share and 200 shares of Stock Y which has a price of $3 per share. What is the proportion of Nico's portfolio invested in stock X?

a. 33%

b. 67%

c. 50%

d. 77%

Answer and Explanation:

Correct answer: Option b) 67%

Explanation:

Nico provided the following information:

His portfolio consists of:

  • Shares of Stock X = 100
  • Price per share of stock X = $12
  • Shares of Stock Y = 200
  • Price per share of stock Y = $3

Total portfolio value of Nico = (Shares of Stock X * Price per share of stock X) + (Shares of Stock Y * Price per share of stock Y)

Total portfolio value of Nico = (100 * $12) + (200 * $3)

Total portfolio value of Nico = $1,800

Proportion of Nico's portfolio invested in Stock X = Investment in Stock X / Total portfolio value

Proportion of Nico's portfolio invested in Stock X = (100 * $12 ) / $1,800

Proportion of Nico's portfolio invested in Stock X = 66.67%


Learn more about this topic:

Portfolio Weight, Return & Variance: Definition & Examples

from Finance 101: Principles of Finance

Chapter 12 / Lesson 1
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