12. Portfoliobeta and weights Ciancy is an analyst at a wealth management firm, One of his clients holds a $10,000 portfolio that consists of four stocks. The investment allocation in the portfolio along with the contribution of risk from each stock is given in the following table: Cancy calculated the portfolio's beta as 0.910 and the portfolio's expected return as 10.92%. Clancy thinks it will be a good idea to reallocate the funds in his client's portfolio. He recommends replacing Atteric Incis shares with the same amount in additional shares of Transter Fuels Co. The risk-free rate is 5.00%, and the market risk premium is 6.50%. According to Clancy's recommendation, assuming that the market is in equilibrium, how much will the portfolo's required return change? 0.92% 0.72% 1.06% 1,14% Analysts' estimates on expected returns from equity investments are based on several factors. These estimations also often include subjective and judgmental factors, because different analysts interpret data in different ways. Suppose, based on the earnings consensus of stock analysts, Clancy expects a return of 10.02% from the portfolio with the new weights. Does he think that the revised portfolio, based on the changes he recommended, is undervalued, overvalued, or fairly valued? Overvalued Undervalued Fairly valued Suppose instead of replacing Atteric Inc.'s stock with Transfer Fuels Co.'s stock, Clancy considers replacing Atteric Inc.'s stock with the equal dollar allocation to shares of Company X's stock that has a higher beta than Atteric Inc.. If everything else remains constant, the required return from the portfolio would