Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You have a $500,000 portfolio consisting of Disney, Netflix, and Walmart. You put $200,000 in Disney, $135,000 in Netflix, and the rest in Walmart. Disney,

You have a $500,000 portfolio consisting of Disney, Netflix, and Walmart. You put $200,000 in Disney, $135,000 in Netflix, and the rest in Walmart. Disney, Netflix, and Walmart have betas of 1.10, 1.45 and 1.03, respectively. The risk-free return is 3.6% and the market return is 8.9% 1) What is your portfolio beta? 2) which is the expected return for each of the stocks according to the CAPM? 3) Which is the expect return of your portfolio according to your portfolio beta?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles Of Finance

Authors: Scott Besley, Eugene F. Brigham

3rd Edition

0324232624, 9780324232622

More Books

Students also viewed these Finance questions