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Brandon is an analyst at a wealth management firm. One of his clients holds a $7,500 portfolio that consists of four stocks. The investment allocation

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Brandon is an analyst at a wealth management firm. One of his clients holds a $7,500 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: Brandon calculated the portfolio's beta as 0.838 and the portfolio's required return as 8.6090%. Brandon thinks it wal be a good idea to reallocate the funds in his client's portfolio. He recommends replacing Atteric Inc.'s shares with the same amount in additional shares of Transfer Fueis Co. The risk-free rate is 4%, and the market risk premium is 5,50%. According to Brandon's recommendation, assuming that the market is in equalibrium, how much will the portfolio's required return change? (Note: Do not round your intermediate calculations.) 0.6778 percentage points 1.0776 percentage points 0.9994 percentage points 0.8690 percentage points 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, Brandon expects a return of 6.24% from the portfolio with the new weights. Does he think that the required return as compared to expected returns is undervalued, overvalued, or fairly valued? Overvalued Fairly valued Undervalued Suppo freplacing Atteric Inc,'s stock with Transfer Fuels Co.'s stock, Brandon considers replacing Atteric Inc.'s stock with the equal dollar allocat s of Company X's stock that has a higher beta than Atteric Inc. If everything else remains constant, the portfolio's beta would

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