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10. Portfolio risk and return Elle holds a $5,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stock's
10. Portfolio risk and return Elle holds a $5,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stock's beta, is listed in the following table: Stock Investment Beta Standard Deviation Andalusian Limited (AL) $1,750 1.00 18.00% Zaxatti Enterprises (ZE) $1,000 1.50 11.50% Water and Power Co. (WPC) $750 1.15 20.00% Mainway Toys Co. (MTC) $1,500 0.60 22.50% Suppose all stocks in Elle's portfolio were equally weighted. Which of these stocks would contribute the least market risk to the portfolio? O Mainway Toys Co. O Andalusian Limited O Water and Power Co. O Zaxatti Enterprises Suppose all stocks in the portfolio were equally weighted. Which of these stocks would have the least amount of standalone risk? O Water and Power Co. O Mainway Toys Co. O Andalusian Limited O Zaxatti Enterprises If the risk-free rate is 7% and the market risk premium is 9%, what is Elle's portfolio's beta and required return? Fill in the following table: Beta Required Return Elle's portfolio
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