factor values and weights
The factor value of stock A is higher than the factor value of stock B, and we use the factor value to determine portfolio weights for the stocks. Assume these are the only stocks in the portfolio, and that this is a long-only portfolio that invests all its cash in stocks, so the weights add up to 1. What are possible values for the weights of stock A and stock B?
weight_A = 0.50 weight_B = 0.50
weight_A = 0.40, weight_B = 0.60
weight_A = 0.60, weight_B = 0.40
weight_A = 0.60, weight_B = 0.50
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