TD Ltd is comprised of 4 major projects, details of which as follows: % of the Co. % returns Risk (%) Std. Deviation 15 Project with 1 2 3 4 Market value 28 17 31 24 Required: a) p.a. 10 18 15 13 20 14 18 0.55 0.75 0.84 0.62 Correlation the market The risk free rate is 5% and the market return is 14% p.a. The standard deviation or the market return is 13%. Evaluate whether or not the share price of TD Ltd is overvalued or undervalued. b) Discuss why your results in (a) above might not correctly identify whether or not the share price of TD Ltd is undervalued or overvalued.