Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Apr 10, 2023

Suppose that the correlation of the return of a portfolio with the return of its benchmark is 0.8, the volatility of the return of the

Suppose that the correlation of the return of a portfolio with the return of its benchmark is 0.8, the volatility of the return of the portfolio is 6%, and the volatility of the return of the benchmark is 4%. What is the beta of the portfolio?

Step by Step Solution

★★★★★

3.39 Rating (152 Votes )

There are 3 Steps involved in it

Step: 1

The beta of a portfolio is a measure of its systematic risk which reflects the sensitiv... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

Step: 3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Statistics The Art And Science Of Learning From Data

Authors: Alan Agresti, Christine A. Franklin

3rd Edition

9780321849281, 321755944, 321849280, 978-0321755940

More Books

Students also viewed these Finance questions

Question

★★★★★

Suppose the required rate of return on a portfolio with beta of 12 is 18 per cent and the risk-free is 6 per cent. According to the CAPM: (a) What is the expected rate of return on the market...

Answered: 1 week ago

Question

★★★★★

1 If your client is not knowledgeable about the market, you should ____ versus comparable portfolios. increase the frequency of trading increase the risk of the portfolio decrease your time with the...

Answered: 1 week ago

Question

★★★★★

The following two equations have a common solution of (1, 2, 3). Which equation would complete a system of three linear equations in three variables having solution set {(1, 2, 3)}? x+y+z=6 2x = y +...

Answered: 1 week ago

Question

★★★★★

What are the five Cs of credit, and how do lenders use them?

Answered: 1 week ago

Question

★★★★★

What is the maximum efficiency that a heat engine could have when operating between the normal boiling and freezing temperatures of water?

Answered: 1 week ago

Question

★★★★★

4. If you received funding to conduct a research project on offender profiling or crime linkage, what study would you choose to conduct and why? You should critique the scope and quality of the...

Answered: 1 week ago

Question

★★★★★

Bhushan Company has been using LIFO for inventory purposes because it would prefer to keep gross profits low for tax purposes. In its second year of operation (20-2), the controller pointed out that...

Answered: 1 week ago

Question

★★★★★

At the beginning of April, Owl Corporation has a balance of $11,700 in the Retained Earnings account. During the month of April, Owl had the following external transactions. Required: Using the...

Answered: 1 week ago

Question

★★★★★

Phayo is a trader. He maintains a full set of accounting records. a. Complete the following table to name one source document from which Phayo will complete each book of prime entry. Phayo sells good...

Answered: 1 week ago

Question

★★★★★

Campbell Corporation uses the retail method to value its inventory. The following information is available for the year 2021: Cost $250,000 629,476 10,400 Retail $340,000 900,000 Merchandise...

Answered: 1 week ago

Question

★★★★★

Simulate a Merge Conflict E. Introduce a merge conflict with the "Test" branch by doing the following: add the git version number to the README.md file on the Working branch merge the "Test" branch...

Answered: 1 week ago

Question

★★★★★

1. [4 Points] Use the Basic Differentiation Rules/Formulas to find the Derivative. Simplify your final answer algebraically and express it in radical notation. f(x) = [xx + 1 131] [x - 1/1/1]

Answered: 1 week ago

Question

★★★★★

You finally saw the couch you need: the colour is perfect (royal blue), the length is just right (it could seat you, your husband, and the kids), and the style is ideal for your furnishings (modern...

Answered: 1 week ago

Question

★★★★★

As a supervisor , write the solution for the employee scenario below Withdrawing from Work: "Chloe is an excellent worker. When she is on, she's on. But when she's not, she can be irritable, erratic,...

Answered: 1 week ago

Question

★★★★★

Downtown Kingston Transport Centre/ Project management Instructions: Read the case study below, access the links provided and answer all questions. The downtown Kingston and Saint Andrew Centre were...

Answered: 1 week ago

Question

★★★★★

You are analyzing the after-tax cost of debt for a firm. You know that the firm's 12-year maturity, 15.50 percent semiannual coupon bonds are selling at a price of $1,117.25. These bonds are the only...

Answered: 1 week ago

Question

★★★★★

A company pledges their receivables so they may Multiple Choice Charge a factoring fee. Increase sales. Recognize a sale. Collect a pledge fee. Borrow money. Failure by a promissory notes' maker to...

Answered: 1 week ago

Question

★★★★★

The table shows results of fitting a regression model to data on Oklahoma State University salaries (in dollars) of 675 full-time college professorsof different disciplines with at least two years of...

Answered: 1 week ago

Question

★★★★★

In one lottery option in Canada, you bet on a six-digit number between 000000 and 999999. For a $1 bet, you win $100,000 if you are correct. The mean and standard deviation of the probability...

Answered: 1 week ago

Question

★★★★★

The SAT2010 data file on the text CD contains combined average SAT scores for each of the 50 states and Washington D.C., and also the corresponding participation rate of each state. Lets consider...

Answered: 1 week ago

Question

★★★★★

Consider the following partially completed two-factor analysis of variance table, which is an outgrowth of a study in which factor A has four levels and factor B has three levels. The number of...

Answered: 1 week ago

Question

★★★★★

A two-factor experiment yielded the following data: Factor A Factor B Level 1 Level 2 Level 3 Level 1 375 402 395 390 396 390 Level 2 335 336 320 342 338 331 Level 3 302 485 351 324 455 346 a....

Answered: 1 week ago

Question

★★★★★

Answered: 1 week ago

Previous Question Next Question