. Por veta weg Brandon is an analyst at a wealth management firm. One of his clients holds a $7,500 portfolio that consists of four stocks. The investment allocation In the portfolio along with the contribution of risk from each stock is given in the following table: Investment Allocation Stock Arteric Inc. (AL) Arthur Trust Inc. (AT) u Corp. C) Transfer Fuels Co (TE) 20% 15% 30 Beta 0.750 1.600 1.100 0.300 Standard Deviation 38.00% 42.00% 45.00% 19.00% E 7 limited Tirandon Calculate the portfolio's betams 0.038 and the portfolio's required return as 8.6090% Drandon this ww be a good ves to reallocate the tundsin dient's portfolio. He recommends replacing Atterie Inc. shares with the same amount in care of Trade Fues Co. The tree rates, and the market rike premium 5.50 According to Branco's common wwwming that the market w in qorum, how much will the porto's required return change (Note: Da not found your recinte ca 9.6776 percentage in 6.99 percentage DS 30 F 000 0604 *** II 08: Assignment - Risk and Rates of Return According to Brandon's recommendation, assuming that the market is in equilibrium, how much will the portfolio's required return change? (Note: Do not round your intermediate calculations.) 0.6778 percentage points 0.9994 percentage points 1.0776 percentage points 0.8690 percentage points Analysts estimates on expected returns from equity investments are based on several factors. These estimations also often include subjective and Judgmental factors, because different analysts interpret data in different ways. Suppose, based on the earrings consensus of stock analysts, tirandon expects a return of 6.24 from the portfolio with the new weights. Does he think that the required return as compared to expected returns is undervalued, overvalued, or fauty valued? Overvalued Fairly valued Undervalued SUDOM wendorphing Attene in stock with Transfer Fuel Costock, Brandon considers replacing Artec Inc.'stock with the equal dollar whocation to whers of Company's stock that has a higher beta than Alten Inot everything else remains contam, the portfolio bets would Grade It Now Save & Continue Ch 08: Assignment - Risk and Rates of Return According to Brandon's recommendation, assuming that the market is in equilibrium, how much will the portfolio's required return change? (Note: Do not round your intermediate calculations) O 0.6778 percentage points O 0.9994 percentage points 1.0776 percentage points 0.8690 percentage points EL 7- mited d Analysts' estimates on expected returns from equity investments are based on several factors. These estimations also often include subjective and judgmental factors, because different analysts interpret data in different ways. Suppor, based on the eaming consensus tock analysts, Br expects a return of 6.3494 from the portfolio with the new weights. Doet he think that the required return as compared to expected returns is undervalued, overvalued, or fairly valued? Overvalued Fairly valued Undervalued tead of replacing Atteni in stock with Transfer Fuels Co.'s stock Brandon considers replacing Atteric Inc.'s stock with the equal dollar increase shares of Company ustack that has a higher beta than Attari Ine everything else remains constant, the portfolios beta would Grade It Now Suve a Continue
