You own the portfolio below, what is your expected return? % of Portfolio Expected Return 15% 40% 45% Stock PCBM NAV MB O 8.0% O 3.9% O: 1.5% O-2.6% 11% -6% 5%
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- Find the Expected Return on the Market Portfolio given that the Cost of Equity is 14% and Risk-Free Rate is 4% and the Beta for Stock Y is 2 Select one: O a. 12.5% O b. 6% c. None d. 9%Risk and Rates of Return; Risk in Portfolio Context You are holding a investments and the portfilio with the following Stock A B C D Total Investament Dollar Investment $250,000 150,000 400,000 200,000 $1,000,000 Beta 1.20 1.60 0.85 -0.15 The market's required return is 11% and the risk-free rate is 4%. What is the portfolio's required return? Round your answer to three places. decimalWhat is the expected return for the following portfolio? (State your answer in percent with two decimal places.) Stock Expected returns Investment AAA 35% $500,000 BBB 29% $1,300,000 CCC 18% $1,200,000 DDD 7% $1,500,000 O.17.13% O.19.40% O.21.01% O.22.21% O.23.88%
- Consider the following simplified APT model: Factor Expected Risk Premium Market 6.4% Interest Rate -0.6% Yield Spread 5.1% Factor Risk Exposures Market Interest Rate Yield Spread Stock Stock(b1) (b2) (b3) P 1.0 -2.0 -0.2 P2 1.2 0 0.3 P3 0.3 0.5 1.0 Required: 1. Calculate the expected return for the above stocks. Assume risk free rate is 5%. Consider a portfolio with equal investments in stocks P, P2 and P3 2.What are the factor risk exposures for the portfolio? 3.What is the portfolio’s expected return?5. Your stock portfolio consists of the following investments: Company A B C Investment A. 1.73 B. 1.88 C. 2.03 D. 2.17 E. 2.40 $ 400 $ 600 $1,000 Standard Deviation 1.5 2.0 3.0 Beta 1.2 1.8 2.2 Expected Return 9% 10% 12% Using the appropriate measure of portfolio risk, calculate your portfolio level of risk.Consider the following simplified APT model: Factor Expected Risk Premium Market 6.4% Interest Rate -0.6% Yield Spread 5.1% Factor Risk Exposures Market Interest Rate Yield Spread Stock Stock (b1) (b2) (b3) P 1.0 -2.0 -0.2 P2 1.2 0 0.3 P3 0.3 0.5 1.0 a) Calculate the expected return for the above stocks. Assume risk free rate is 5%. Consider a portfolio with equal…
- D1 = $1.25, g = 6.00%, β = 1.15, market risk premium = 5.5%, and risk free rate = 4 %. Find the stock price $28.90 $28.62 $29.36 $30.12Mike Flannery holds the following portfolio: What is the portfolio's beta? Do not round your intermediate calculations.Stock Investment BetaA $150,000 1.40B $20,000 0.80C $130,000 1.00D $75,000 1.20Total $375,000 Question 6Select one: a. 1.02 b. 1.05 c. 1.28 d. 1.19 e. 1.43For an investment in a stock, the probability of the return being -10.0% is 0.3, 10.0% is 0.4, and 30.0% is 0.3. Given the probability distributions, what is the expected rate of return for the investment?Choices:A. 10.00%B. 9.50%C. 15.00%D. 12.50%E. 13.00%
- Find the Risk Free Rate given the cost of equity 12%, the Expected Return on Market Portfolio is 16% and the Beta for Stock Y is 0.6. Select one: a. None b. 4% C. 6% O d. 2%Calculate the weighted average expected return of the portfolio. Stock Investment Expected ReturnA $20,000 15%B $4,000 10%C $26,000 12%Q2: By using CAPM calculate the required return on equity if Risk free rate is 18%, Expected Market Return is 20% and company beta is 1.5
