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4. Portfolio risk and return Elle holds a $10,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stocks
4. Portfolio risk and return
Elle holds a $10,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stocks beta, is listed in the following table:
Stock | Investment | Beta | Standard Deviation |
---|---|---|---|
Omni Consumer Products Co. (OCP) | $3,500 | 0.80 | 15.00% |
Tobotics Inc. (TI) | $2,000 | 1.90 | 12.00% |
Three Waters Co. (TWC) | $1,500 | 1.20 | 16.00% |
Makissi Corp. (MC) | $3,000 | 0.50 | 28.50% |
If the risk-free rate is 7% and the market risk premium is 9%, what is Elles portfolios beta and required return? Fill in the following table:
| Beta | Required Return |
---|---|---|
Elles portfolio |
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