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You are managing a mutual fund for which you need to pick some stocks. Relevant information is given below: Stocks Investment Beta Expected return (%)

You are managing a mutual fund for which you need to pick some stocks. Relevant information is given below:

Stocks Investment Beta Expected return (%)

Alpha 120,000 2.20 25

Beta 180,000 1.05 16

Teta 360,000 0.62 14

Gamma 340,000 1.30 18

Market return is 16% and risk-free rate is 7%.

c.Would standard deviation calculation for individual stocks be a better criterion? Why/why not?

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