Course: Securities & Investments

1. A stock has a return of 12.9 percent and a beta of 1.27. The market return is 12.6 percent and the risk-free rate is 4.13 percent. What's the Jensen alpha of this stock?

A. 1.56% B. -1.73% C. -1.56% D. 1.73%

5. What's the covariance of a security to the market given the following information? Year Security Returns Market Returns 1 28 24 2 12 15 3 -13 -8 O A. 337 B. 295 C. 321 D. 274