Standard Deviation Atteric Inc. (AI)35%0.6000.38% Arthur Trust Inc. (AT)20%1.6000.42% Li Corp. (LC)15%1.1000.45% Transfer Fuels Co. (TF)30%0.4000.49% Kevin calculated the portfolio’s beta as 0.815 and the portfolio’s expected return as 10.30%. Kevin thinks it will be a good idea to reallocate the funds in his client’s portfolio. He recommends replacing Atteric Inc.’s shares with the same amount in additional shares of Transfer Fuels Co. The risk-free rate is 5.00%, and the market risk premium is 6.50%. According to Kevin’s recommendation, assuming that the market is in equilibrium, the portfolio’s required return will change by . 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 earnings consensus of stock analysts, Kevin expects a return of 9.90% from the portfolio with the new weights. Does he think that the revised portfolio, based on the changes he recommended, is undervalued, overvalued, or fairly valued? Overvalued Undervalued Fairly valued