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pinkmink189Lv1
28 Sep 2019
CAPM and portfolio return You have been managing a $5 million portfolio that has a beta of 1.55 and a required rate of return of 12%. The current risk-free rate is 5.00%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 1.30, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places.
CAPM and portfolio return You have been managing a $5 million portfolio that has a beta of 1.55 and a required rate of return of 12%. The current risk-free rate is 5.00%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 1.30, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places.
Liked by mustafa.mahmood.925
Irving HeathcoteLv2
28 Sep 2019
Related questions
| You hold the positions in the table below. |
| PRICE | SHARES | BETA | ||
| Advanced Micro Devices | $ | 21.60 | 208 | 4.4 |
| FedEx Corp | 102.00 | 58 | 1.2 | |
| Microsoft | 23.20 | 155 | 1.4 | |
| Sara Lee Corp | 17.00 | 216 | 0.9 | |
| What is the beta of your portfolio? (Round your answer to 2 decimal places.) |
| Portfolio beta |
| If you expect the market to earn 17.0 percent and the risk-free rate is 5.5 percent, what is the required return of the portfolio? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "%" sign in your response.) |
| Portfolio's required return | % |
