EVALUATION OF PORTFOLIO BETA AND THE REQUIRED RETURN ON STOCK The tendency of a stock's price to move up and down with the market is reflected in its beta coefficient Therefore, beta is a measure of an investment's market risk, and is a key element of the CAPM In this part of the project, you get financial information using Yahoo Finance (found athttp finance yahoo com ) To find a company's beta, enter the desired stock symbol and request a basic quote Once you have the basic quote, select the Statistics Scroll down this page to find the stock's beta In your initial response to the topic you have to answer all 5 questions You are expected to make your own contribution in a main topic as well as respond with value added comments to at least two of your classmates as well as to your instructor From Yahoo Finance obtain a report on any two companies What are the betas listed for these companies If you made an equal dollar investment in each stocks what would be the beta of your portfolio Please how your work If you made 70 of dollar investment in stock A, and 30 of dollar investment in stock B, what would be the beta of your portfolio Please how your work Apply the Capital Asset Pricing Model (CAPM) Security Market Line to estimate the required return on both stock Note that you will needthe risk free rate and the market return a) To get the current yield on 10 year Treasury securities go to Finance Yahoos at www finance yahoo com click on Market Data Bonds You will use the current yield on 10 year Treasury securities as the risk free rate to estimate the required rate of return on stocks b) To get the market return go towww money cnn com, Click on Market, then click on S P 500 You will use 52 weeks change for S P500 listed as Year to Date percentage change c) Calculate the required return on both stockusingthe Capital Asset Pricing Model (CAPM) Security Market Line Please show your work Find on the Internet the 52 weeks change of the stock price Compare the required return on these stocks calculated using CAPM against their historical return over the last 52 weeks Is there a difference between these returns Are these stock overvalued, undervalued, or properly valued Why In accordance with your founding, is it reasonable for the investor to buy any of these stocks Explain your answers

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EVALUATION OF PORTFOLIO BETA AND THE REQUIRED RETURN ON STOCK The tendency of a stock's price to move up and down with the market is

EVALUATION OF PORTFOLIO BETA AND THE REQUIRED RETURN ON STOCK

The tendency of a stock's price to move up and down with the market is reflected in its beta coefficient. Therefore, beta is a measure of an investment's market risk, and is a key element of the CAPM. In this part of the project, you get financial information using Yahoo!Finance (found athttp://finance.yahoo.com/)

To find a company's beta, enter the desired stock symbol and request a basic quote. Once you have the basic quote, select the"Statistics". Scroll down this page to find the stock's beta.

In your initial response to the topic you have to answer all 5 questions.

You are expected to make your own contribution in a main topic as well as respond with value added comments to at least two of your classmates as well as to your instructor.

From Yahoo!Finance obtain a reporton any two companies.

What are the betas listed for these companies?
If you made an equal dollar investment in each stocks what would be the beta of your portfolio?Please how your work.
If you made 70% of dollar investment in stock A, and 30% of dollar investment in stock B, what would be the beta of your portfolio?Please how your work.
Apply the Capital Asset Pricing Model (CAPM) Security Market Line to estimate the required return on both stock. Note that you will needthe risk-free rate and the market return.a) To get the current yield on 10-year Treasury securities go to Finance!Yahoos at www.finance.yahoo.com -click on Market Data - Bonds. You will use the current yield on 10-year Treasury securities as the risk-free rate to estimate the required rate of return on stocks.b) To get the market return go towww.money.cnn.com, Click on Market, then click on S&P 500.You will use 52-weeks change for S&P500 listed as Year-to-Date percentage change.c) Calculate the required return on both stockusingthe Capital Asset Pricing Model (CAPM) Security Market Line.Please show your work.
Find on the Internet the 52-weeks change of the stock price. Compare the required return on these stocks calculated using CAPM against their historical return over the last 52 weeks. Is there a difference between these returns? Are these stock overvalued, undervalued, or properly valued? Why? In accordance with your founding, is it reasonable for the investor to buy any of these stocks? Explain your answers.