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Mr. Robinson, an Australian investor is very much interested in investing Rs.1 million in the pharmaceutical sector in India. He decides to invest in the
Mr. Robinson, an Australian investor is very much interested in investing Rs.1 million in the pharmaceutical sector in India. He decides to invest in the scrip of Morepen Labs Ltd. which is listed on BSE and the details of scrip are given below Beta of the security : 1.65 Variance of returns : 25(%)2 Appreciation of Australian dollar against rupees is 3% with a variance of 10(%). Return on BSE index is 12% annualized and return on long dated Indian Government securities is 6.5%. Assume that the correlation between the return on the scrip and Rs / AUS$ exchange rate is zero. You are required to estimate the expected return and risk of Mr. Robinson, if his holding period is one year
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