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A stock has an CAPM return of 4.4% and an HPR return of 5.5%. Which of the following is true? You should buy the stock

A stock has an CAPM return of 4.4% and an HPR return of 5.5%. Which of the following is true?

You should buy the stock because it is undervalued.

You should short the stock because it is overvalued.

You should short the stock because it is undervalued.

You should buy the stock because it is overvalued.

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