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solve in 35 mins I will give you upvote Question 4 You have just nun a regression of monthly returns on stock x4 a software

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solve in 35 mins I will give you upvote

Question 4 You have just nun a regression of monthly returns on stock x4 a software firm in the US, against returns on the S\&P 500 oyer the period from 2015-2019, and arrived at the following resuit: Rakc =0.0806+1.50 Rsop The regression has an R-squared of 32%. The monthly riskfree rate during the period of the regression was 0.50%. The current T.Bill rate is 5.5% and the current T.Bond rate is 6.5%. The current annual return on the S\&P 500 index is 12%. a). Based on the regression results, did stock perform better or worse than expected over he estimation period? And by how much? [20 Marks] a). Besed on the regressian results, did stock X perform better ar worse than nxpected over the estimation period? And by how much? (20 Marks) b). What is your expectation for stock X 's feturn in the future? [20 Marks] c). What is the proportion of stock X 's total risk that is systematic risk? And what is the proportion of firm-specific risk? [20 Marks] d). In estimating beta for stocks using regressions, should we choose a long or a short period and why? [20 Marles] e). Please provide two alternative ways that the underlying firm of stock X can use to reduce its beta. [20 Marks] Question 4 You have just nun a regression of monthly returns on stock x4 a software firm in the US, against returns on the S\&P 500 oyer the period from 2015-2019, and arrived at the following resuit: Rakc =0.0806+1.50 Rsop The regression has an R-squared of 32%. The monthly riskfree rate during the period of the regression was 0.50%. The current T.Bill rate is 5.5% and the current T.Bond rate is 6.5%. The current annual return on the S\&P 500 index is 12%. a). Based on the regression results, did stock perform better or worse than expected over he estimation period? And by how much? [20 Marks] a). Besed on the regressian results, did stock X perform better ar worse than nxpected over the estimation period? And by how much? (20 Marks) b). What is your expectation for stock X 's feturn in the future? [20 Marks] c). What is the proportion of stock X 's total risk that is systematic risk? And what is the proportion of firm-specific risk? [20 Marks] d). In estimating beta for stocks using regressions, should we choose a long or a short period and why? [20 Marles] e). Please provide two alternative ways that the underlying firm of stock X can use to reduce its beta. [20 Marks]

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