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Sept/Dec20 Q1 Weighted average Beta

This topic has 1 reply, 2 voices, and was last updated 1 year ago by John Moffat.

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April 27, 2021 at 8:12 pm #619016
nataly1986
Member
- Topics: 21
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Hi, I didn’t quite understand the calculation in answers for Weighted average Beta=(0.72*(150/150+60)+(0.88*(60/150+60)=0.77.
Could we just calculate as follow:
Outdoor business 40%*0.88(Ba for outdoor)=0.352
Garden business 60%*0.72(Ba for garden)=0.432
Weighted average =0.78
Thank you!
April 28, 2021 at 9:02 am #619039
John Moffat
Keymaster
- Topics: 56
- Replies: 51563
Currently they have $150M invested in garden centres and intend to invest $60M in outdoor shops. So the total invested will be $210M. Therefore the proportion invested in garden centres will be 150/210 and the proportion invested in outdoor shops will be 60/210.
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