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Angela's portfolio is made up of three asset classes: 10% cash or cash equivalent assets averaging...

Angela's portfolio is made up of three asset classes: 10% cash or cash equivalent assets averaging 1% return 50% Stock averaging 11% annual return 40% Bonds averaging 4% annual return What is the total estimated portfolio return? Please write down your answer in percentage terms, for example if your answer is 7.5%, then please write down 7.5 as your answer.

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Answer #1

Ans 7.2

ASSET CLASS Probability (P) RETURN (Y) (P * Y )
CASH OR CASH EQUIVALENT 10% 1% 0.10%
STOCK 50% 11% 5.50%
BONDS 40% 4% 1.60%
TOTAL 7.20%
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