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Show all your computations. The analysts at JP MORGAN compiled information on the following securities. Stock Investment Stocks Beta Coefficient Standard Deviation Expected Return Facebook
Show all your computations.
The analysts at JP MORGAN compiled information on the following securities.
Stock | Investment | Stocks Beta Coefficient | Standard Deviation | Expected Return |
Facebook (FB) | $100 million | 1.5 | 12.5% | 18.0% |
Best Buy (BBY) | 120 million | 1.2 | 18.2 | 21.0 |
Chipotle Mexican Grill (CMG) | 40 million | 1.8 | 21.84 | 10.0 |
Pfizer (PF) | 80 million | 1.5 | 9.0 | 8.0 |
3M Co (MMM) | 60 million | 1.6 | 11.36 | 14.0 |
You are a manager of a private equity fund who has decided to construct a portfolio consisting of all the securities listed.
- Compute the return on the portfolio. 5 points
- Compute the beta of the portfolio. 5 points
(Please show the equation you are using. Thank you!)
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