Olivia has a portfolio of 8 securities, each with a market value of $6,000. The current...
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Olivia has a portfolio of 8 securities, each with a market value of $6,000. The current beta of the portfolio is 1.25 and the beta of the riskiest security is 1.85. Olivia wishes to reduce her portfolio beta to 1.10 by selling the riskiest security and replacing it with another security with a lower beta. What must be the beta of the replacement security? Olivia has a portfolio of 8 securities, each with a market value of $6,000. The current beta of the portfolio is 1.25 and the beta of the riskiest security is 1.85. Olivia wishes to reduce her portfolio beta to 1.10 by selling the riskiest security and replacing it with another security with a lower beta. What must be the beta of the replacement security?
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Related Book For
Intermediate Accounting
ISBN: 978-0132162302
1st edition
Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Posted Date:
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