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Elle holds a $7,500 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 $7,500 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 Investment $2,625 0.90 Stock Omni Consumer Products Co. (OCP) Tobotics Inc. (TI) Three Waters Co. (TWC) Flitcom Corp. (FC) Standard Deviation 9.00% 11.50% $1,500 1.90 $1,125 1.15 18.00% $2,250 0.30 28.50% Suppose all stocks in Elle's portfolio were equally weighted. Which of these stocks would contribute the least market risk to the portfolio? Three Waters Co. Flitcom Corp. Tobotics Inc. Omni Consumer Products Co. Suppose all stocks in the portfolio were equally weighted. Which of these stocks would have the least amount of stand-alone risk? Tobotics Inc. Omni Consumer Products Co. Three Waters Co. Flitcom Corp. If the risk-free rate is 4% and the market risk premium is 5.5%, 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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