A stock has a Beta of 1.2, a standard deviation of 16% and a return of 9%. During the same period the market has a return of 11%, a standard deviation of 13%. The risk-free rate of 4%. 10 points a. Sketch the SML and plot where this stock falls in relation to the SML. b. Is this stock undervalued or overvalued? A stock has a Beta of 1.2, a standard deviation of 16% and a return of 9%. During the same period the market has a return of 11%, a standard deviation of 13%. The risk-free rate of 4%. 10 points a. Sketch the SML and plot where this stock falls in relation to the SML. b. Is this stock undervalued or overvalued