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Elle holds a $10,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stock's beta, is listed in the
Elle holds a $10,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stock's beta, is listed in the following table: Beta 0.80 Stock Omni Consumer Products Co. (OCP) Zaxatti Enterprises (ZE) Three Waters Co. (TWC) Makiss Corp. (MC) Investment $3,500 $2,000 $1,500 $3,000 1.30 1.15 Standard Deviation 18.00% 11.50% 16.00% 19.50% 0.60 Suppose all stocks in Elle's portfolio were equally weighted. Which of these stocks would contribute the least market risk to the portfolio? o Three Waters Co. O Zaxatti Enterprises O Omni Consumer Products Co. Makiss! Corp. Suppose all stocks in the portfolio were equally weighted. Which of these stocks would have the least amount of stand-alone risk? O Zaxatti Enterprises Three Waters Co. Makissi Corp. Omni Consumer Products Co. If the risk-free rate is 7% and the market risk premium is 8.5%, what is Elle's portfolio's beta and required return? Fill in the following table: Beta Required Return Elle's portfolio
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