If portfolio A has a beta of 1.2, and portfolio Z has a beta of 0.2, what

Question:

If portfolio A has a beta of 1.2, and portfolio Z has a beta of –0.2, what do the two values indicate? If the return on the market rises by 10%, what impact, if any, would this have on the returns from portfolios A and Z? Explain.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Fundamentals Of Investing

ISBN: 9781292153988

13th Global Edition

Authors: Scott B. Smart, Lawrence J. Gitman, Michael D. Joehnk

See More Books

Question Posted: Apr 04, 2024 01:00 AM

See More Questions

Quaker Instant Oatmeal has been a household staple for generations. Recently, its instant product has received a brand extension to include high fibre. It has quinoa for those who suffer from gluten...
Directions: Imagine you are given the broad topic: UNHEALTHY BEHAVIOR. Narrow the said topic by picking at least two of the random words below then do the steps of narrowing it down into a specific...
If portfolio A has a beta of 1.5 and portfolio Z has a beta of -1.5, what do the two values indicate? If the return on the market rises by 20%, what impact, if any, would this have on the returns...
Find the laurents series f(z)= 1/(z-1)(z-2) (i) |z| <1 (ii) 1 2
You are conducting an audit of sales for James Smith Pty Ltd, a retail chain store with a computerized sales system in which computerised cash registers are integrated directly with accounts...
Shimmer Products is considering which bad debt estimation method works best for its company. It is deciding between the income statement method, balance sheet method of receivables, and balance sheet...
(2) Using the mechanistic-organic model, analyse the structural changes that Oticon went through.
The gage pressure of the air in the tank shown in Fig P173 is measured to be 80 kPa. Determine the differential height h of the mercury column. Oil SG 0.72 80 kPa 75 cm Air Mercury SG 13.6 30 cm
Problem 11-1 Corporate Tax Rates (LO 11.1) Quince Corporation has taxable income of $475,000 for its calendar tax year. Calculate the corporation's income tax liability for the year before tax...
Katie plans to form a portfolio consisting of two securities, Intel (INTC) and Procter & Gamble (PG), and she wonders how the portfolios return will depend on the amount that she invests in each...
Jay is reviewing his portfolio, which includes certain stocks and bonds. He has a large amount tied up in U.S. Treasury bills paying 2%. He is considering moving some of his funds from the T-bills...
Consider the following population data: a. Calculate the range. b. Calculate MAD. c. Calculate the population variance. d. Calculate the population standarddeviation. 34 42 12 10 22
The table 1 below is shown the production theory of labour for company D'LIMAU Sdn Bhd. Input X Input Y Total Product (TP/Q) 1 0 0 1 1 20 1 2 80 1 3 180 1 4 230 1 5 270 1 6 270 1 7 210 Average...
Describe the most important three rights in the Bill of Rights of the United States Constitution. The Bill of Rights is the first ten amendments to the Constitution, but they contain far more than...
A red/white wine-tasting party will be held in the school in April, and the theme of the event will be formulated based on the season (April), place (Ontario/Canada), and target participants. Please...
We explored many of the revenue streams available to fund fire prevention practices. Describe one revenue stream and explain why you feel it is the most important in supporting fire prevention...
Multi-national management in a global economy requires a variety of hard and soft skills. This assignment is meant to enhance the understanding of multi-national situations locally or globally, and...
How do firms identify internal strengths and weaknesses? Why is it vital that managers have a clear understanding of their firms strengths and weaknesses?
Use the information given about the angles and to find the exact value of: (a) sin( + ) (b) cos( + ) (c) sin( - ) (d) tan ( + ) (e) sin(2) (f) cos (2) (g) sin /2 (h) cos/2 cos = 4/5, 0 < < /2; cos =...
3. The nominal interest rate compounded monthly when your $7,000 becomes $11,700 in eight years is ________
An investor can design a risky portfolio based on two stocks, A and B. Stock A has an expected return of 21% and a standard deviation of return of 39%. Stock B has an expected return of 14% and a...
Advanced Small Business Certifica Drag and Drop the highlighted items into the correct boxes depending on whether they increase or decrease Alex's stock basis. Note your answers- you'll need them for...

If portfolio A has a beta of 1.2, and portfolio Z has a beta of 0.2, what

Question:

Step by Step Answer:

Absolutely lets break down what the betas of portfolio A and Z tell us and how they would react to a 10 market increase Understanding Beta Values Beta ...View the full answer

Fundamentals Of Investing

Students also viewed these Business questions