Question
You have observed the following returns over time: Year Stock X Stock Y Market 2011 12 % 13 % 13 % 2012 19 7 11
You have observed the following returns over time:
Year | Stock X | Stock Y | Market | |||
2011 | 12 | % | 13 | % | 13 | % |
2012 | 19 | 7 | 11 | |||
2013 | -12 | -2 | -12 | |||
2014 | 4 | 2 | 1 | |||
2015 | 20 | 12 | 13 |
Assume that the risk-free rate is 3% and the market risk premium is 6%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below.
Open spreadsheet
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What is the beta of Stock X? Do not round intermediate calculations. Round your answer to two decimal places.
fill in the blank 2
What is the beta of Stock Y? Do not round intermediate calculations. Round your answer to two decimal places.
fill in the blank 3
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What is the required rate of return on Stock X? Do not round intermediate calculations. Round your answer to one decimal place.
fill in the blank 4 %
What is the required rate of return on Stock Y? Do not round intermediate calculations. Round your answer to one decimal place.
fill in the blank 5 %
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What is the required rate of return on a portfolio consisting of 80% of Stock X and 20% of Stock Y? Do not round intermediate calculations. Round your answer to one decimal place.
fill in the blank 6 %
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