Question
Stock % of Portfolio Beta Historical Required Return Return 1 13% 1.15 .11 2 44% 0.95 .08 3 19% 1.60 .14 4 24% 1.30 .12
| Stock | % of Portfolio | Beta | Historical | Required |
|
|
|
| Return | Return |
| 1 | 13% | 1.15 | .11 |
|
| 2 | 44% | 0.95 | .08 |
|
| 3 | 19% | 1.60 | .14 |
|
| 4 | 24% | 1.30 | .12 |
|
The risk-free rate is 5% and the expected market return is 10%.
Calculate the required return for each stock.
Calculate the historical return on the portfolio.
Calculate the portfolio beta.
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Corporate Financial Management
Authors: Glen Arnold, James Pickford
2nd Edition
0582821762, 978-0582821767
