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TSX has beta of 1 and expected rate of return 8%. Treasury bills provide a risk-free return of 3%. If you want to construct a
TSX has beta of 1 and expected rate of return 8%. Treasury bills provide a risk-free return of 3%. If you want to construct a portfolio, p, from these two assets with beta of 0.2, what are the weights of each asset and the expected rate of return for portfolio p ? Weight of risk free asset is ; Weight of the TSX is and the expected rate of return on the portfolio is Select one: a. 0.5;0.5; and 8% b. 0.5;0.5; and 6% c. 0.8;0.2; and 4% d. 0.4;0.6; and 6% e. 0.4;0.6; and 8%
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