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1. You have been provided with the following data on the securities of three firms, the market portfolio and the risk-free asset Security B CP
1. You have been provided with the following data on the securities of three firms, the market portfolio and the risk-free asset Security B CP Market Risk-free asset 0.13 0.16 0.25 0.15 0.05 0.12 X2 0.24 0.10 X6- 0.40. 0.75 X4- 0.90 1.10 X3- where-is the average realized return of asset i in the recent past (equal to its expected return today), is the standard deviation of asset i's returns. is the correlation of asset i's returns with the market returns and is the beta of asset i. Assume the CAPM holds true a) Fill in the missing values X1,...,X8 in the table without using the information on average realized returns. Provide an evaluation of the investment performance of the three firms and make justified investment recommendations. b)
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