Question
You are looking at two different stocks. Climber, Inc. has a beta of 1.25 and Steady As She Goes Co. has a beta of .95.
- You are looking at two different stocks. Climber, Inc. has a beta of 1.25 and Steady As She Goes Co. has a beta of .95. Which statement is true about these investments?
a. Climber, Inc. is a better addition to your portfolio.
b. Steady As She Goes Co. is a better addition to your portfolio.
c. The stock in Steady As She Goes Co. has a lower risk premium than Climber Inc.
d. The expected return on Climber will be the lower of the two.
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Fundamentals Of Contemporary Financial Management
Authors: R. Charles Moyer, James R. McGuigan, Ramesh P. Rao
2nd Edition
0324406363, 978-0324406368
