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you are the portfolio manager of the BA Fund, a $3 million hedge fund that contains the following stocks. The required rate of return on
you are the portfolio manager of the BA Fund, a $3 million hedge fund that contains the following stocks. The required rate of return on the market is 10.00% and the risk-free rate is 4.50%. What rate of return should investors expect and require on this fund?
Stock A amount (1,075,000) beta (1.2)
Stock b amount (675,000) beta (.5)
Stock c amount (750,000) beta 1.40
stock d amount (500,000) beta .75
Total amount 3,000,000
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