You have a portfolio with the following Environmental Risk Scores for each of your investments. Given the weights in each investment, what is the Environmental Risk Score for your portfolio? If the weights don't sum to one then the remainder is in cash with no environmental risk. (Answer to one decimal place, 6.1)

Tesla Ford Chevron Home Depot JP Morgan Starbucks Microsoft
Weight (in %) 10 13 8 4 10 12 9
Env Risk Score 3 10 17 5 3 9 7

Question

You have a portfolio with the following Environmental Risk Scores for each of your  investments. Given the weights in each investment, what is the Environmental Risk Score for your portfolio? If the weights don't sum to one then the remainder is in cash with no environmental risk. (Answer to one decimal place, 6.1)

Tesla	Ford	Chevron	Home Depot	JP Morgan	Starbucks	Microsoft
Weight (in %)	10	13	8	4	10	12	9
Env Risk Score	3	10	17	5	3	9	7

BlackTom AI · Accepted Answer

To determine the portfolio's Environmental Risk Score, we treat each investment's weight as its share of the total portfolio (percent) and compute a weighted average of the Environmental Risk Scores, while any unassigned portion (cash) has zero risk.

First, sum all provided weights to see how much of the portfolio is accounted for: 10 + 13 + 8 + 4 + 10 + 12 + 9 = 66%. This means 34% of the portfolio is cash with no environmental risk, contributing 0 to the weighted average.

Next, multiply each investment’s weight by its Environmental Risk Score:
- Tesla: 10% * 3 = 30
- Ford: 13% * 10 = 130
- Chevron: 8% * 17 = 136
- Home Depot: 4% * 5 = 20
- JP Morgan: 10% * 3 = 30
- Starbucks: 12% * 9 = 108
- Microsoft: 9% * 7 = 63

Then sum these products: 30 + 130 + 136 + 20 + 30 + 108 + 63 = 517.

Since the weights are percentages of the total portfolio, the weighted average Environmental Risk Score is the sum of these products divided by 100 (to convert from percentage points to a relative score): 517 / 100 = 5.17.

Finally, round to one decimal place as required: 5.17 rounds to 5.2.

Thus, the portfolio Environmental Risk Score, to one decimal place, is 5.2. The cash portion (34%) contributes zero risk and is implicitly included by not contributing to the weighted sum beyond reducing the effective weights of the invested assets.

FINA3401.13791.202610

查看解析

登录即可查看完整答案

类似问题

In a consumer society, many adults channel creativity into buying things

Economic stress and unpredictable times have resulted in a booming industry for self-help products

People born without creativity never can develop it

更多留学生实用工具

考试浏览器助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单