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Assume that you are a portfolio manager, currently evaluating two possible investment. You have gathered following information: Assume that an analysist at a major brokerage
Assume that you are a portfolio manager, currently evaluating two possible investment. You have gathered following information: Assume that an analysist at a major brokerage firm have been following the five stocks in the \begin{tabular}{l} precedint \\ \hline \\ \hline \end{tabular} The average market risk premium for next 1 year is estimated to be 7-\% a year while expected rate of return for frisk-free asset (T-bill) about 3%. Draw the security market line. plot stock A,B, and C on SML Identify whether securities are under- over or fairly priced
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