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Cvm matrix You have a CVM matrix for 9 LSE listed securities (2-10) and return for the London (1) Index Sex 1 2 3 4

Cvm matrix

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You have a CVM matrix for 9 LSE listed securities (2-10) and return for the London (1) Index Sex 1 2 3 4 5 6 7 8 9 10 E(R) Beta CAPM alpha 1 4.00% 8.00% 2. 6.50% 19.00% 7.00% 3 7.00% 12.00% 22.00% 10.00% 4 6.00% 2.00% 1.50% 19.00% 6.00% 5 2.00% 3.00% 3.00% 14.00% 17.00% 12.00% 6 2.40% 4.00% 4.50% 12.00% 32.00% 7.40% TI 00 -3.00% 6.00% 7 3.00% 5.00% 2.30% 11.00% 17.00% 8.00% 6.40% 1.50% 6.00% 6.50% 8.00% 5.00% 12.00% -2.00% 6.00% 8.20% 9 5.00% 8.00% 7.00% 4.00% 8.00% 16.00% 1.50% 5.00% 9.00% 3.20% 10 2.50% -2.00% 3.00% 6.00% 7.00% 8.00% 3.50% 4.00% 8.00% 13.00% 5.20% Market Return (London Stock Exchange) * :If the yield on government bonds equals 2%, find the following Find which stock is above or below the stock market line (SML).1 .Find which securities are overvalued or undervalued .2 Which stock would you recommend to buy .3 Which stock will have the best benefit in reducing portfolio risk.4

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