You short $5,000 of Stock S and go long $5,000 of Stock L, as displayed in the chart. If the market rises by 10%, what is the expected dollar gain or loss for this trade. Ignore any margin requirements or interest. Write your answer as a dollar amount, without the $ sign. Use a negative sign to precede your answer if you lost money. It turns out that you made more or less than you calculated above. What is the best explanation: You used beta to predict the returns when you should only consider alpha You took on too much risk You did not account for the randomness of returns not included in beta Shorting a stock is risky and therefore expected return calculations do not apply