P8-20 (similar to) Question Help The risk-free rate is 6 percent. Also, the expected return on (Portfolio beta and security market line) You own a portfolio consisting of the following stocks: the market portfolio is 15 percent. a. Calculate the expected return of your portfolio. (Hint: The expected return of a portfolio equals the weighted average of the individual stock's expected return, where the weights are the percentage invested in each stock.) b. Calculate the portfolio beta c. Given the preceding information, plot the security market line on paper. Plot the stocks from your portfolio on your graph. d. From your plot in partc, which stocks appear to be your winners and which ones appear to be losers? e. Why should you consider your conclusions in part d to be less than certain? A Data Table Stock Percentage of Portfolio Beta Expected Return 30% 35% 8% 15% 0.95 0.75 1.22 0.55 1.62 18% 15% 22% 9% 26% 12% Print Done (Capital asset pricing model) Anita, Inc. is considering the following investments. The current rate on Treasury bills is 7 percent, and the expected return for the market is 15 percent. Using the CAPM, what rates of return should Anita require for each individual security? Stock Beta 0.96 1.65 0.92 1.39 a. The expected rate of return for security H, which has a beta of 0.96, is %. (Round to two decimal places.)