Question
Quantitative Problem: You are holding a portfolio with the following investments and betas: Stock Dollar investment Beta A $250,000 1.25 B 200,000 1.5 C 400,000
Quantitative Problem: You are holding a portfolio with the following investments and betas:
| Stock | Dollar investment | Beta |
| A | $250,000 | 1.25 |
| B | 200,000 | 1.5 |
| C | 400,000 | 0.65 |
| D | 150,000 | -0.25 |
| Total investment | $1,000,000 | |
The market's required return is 10% and the risk-free rate is 3%. What is the portfolio's required return? Round your answer to 3 decimal places. Do not round intermediate calculations. %
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Finance Capital Markets Financial Management And Investment Management
Authors: Frank J. Fabozzi, Pamela Peterson Drake
1st Edition
0470407352, 978-0470407356
