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The risk-free rate is 3.2% and you believe that the S&P 500's excess return will be 11.3% over the next year. If you invest in
The risk-free rate is
3.2%
and you believe that the S&P 500's excess return will be
11.3%
over the next year. If you invest in a stock with a beta of
1.5
(and a standard deviation of
30%),
what is your best guess as to its expected excess return over the next year?
The expected excess return over the next year is?
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