(Jensens alpha) The risk-free rate is 2%. You observe two fund managers (A and B) and the...
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(Jensen’s alpha) The risk-free rate is 2%. You observe two fund managers (A and B) and the market portfolio.
a. Calculate the beta of each stock and the market portfolio.
b. Calculate the “Normative return” based on the SML for each stock and the market portfolio.
c. Calculate Jensen’s alpha for each stock and the market portfolio.
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Related Book For 
Principles Of Finance Wtih Excel
ISBN: 9780190296384
3rd Edition
Authors: Simon Benninga, Tal Mofkadi
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