39 percent of portfolio rose 5.8% and 61 percent of portfolio rose 3.8%. What is average percent rise?

Question

I'm trying to figure the average gain in two stock funds. The proportion of each fund is as stated. As are the returns for both. 

Answer 1

I suggest taking a weighted combination of the portfolio increases.  You can use the percentages to weight the increases:

 

weighted average = [(39)(5.8%) + 61(3.8%)] / (39 + 61) 

 

= 0.39(5.8%) + 0.61(3.8%) = 4.58%