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Portfolio Actual return Standard deviation Beta X 10.2% 12% 1.2 Y 8.8% 9.9% 0.8 Additionally, the risk premium for the market portfolio is 5% and
| Portfolio | Actual return | Standard deviation | Beta |
| X | 10.2% | 12% | 1.2 |
| Y | 8.8% | 9.9% | 0.8 |
Additionally, the risk premium for the market portfolio is 5% and the risk-free rate is 4.5%.
a. For both Portfolio X and Y, calculated the expected returns using the CAPM.
b. Evaluate the performances of Portfolio X and Y using your answers from Part a and the information given in the table above.
c. What is the essential aspect of assessing portfolio performance using an asset pricing model?
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