ou have a portfolio of stocks with an overall beta of 1.5.  What will be the new portfolio beta if you keep 80% of your money in the old portfolio and move 20% of your money to a stock with a beta of 0.8?

stock in your portfolio? 13. Using CAPM A stock has a beta of 1.14, the expected return on the market is 10.9 percent, and the risk-free rate is 3.6 percent. What must the expected return on this stock be?

Use CAPM to solve the following: A stock as a beta of 0.9 and the market expects to return 12.0%. If the risk free rate is 2.0%, what is the expected return of the stock? 14.2% 8.6% 3.4% 11.0%

You expect the risk-free rate to be 4 percent and the market return to be 10 percent. You also have the following information about three stocks. Stock Beta Current Expected Expected Price Price Dividend U 1.5 $10 $11.50 $1.00 N 1.1 $27 $30 $0.00 Ο 0.8 $35 $36 $1.50 (Question 1 of 2) Based on the required rate of return estimated with the CAPM and your expected returns based on prices and dividends, select an investment strategy for each stock: Stock U Stock N [Choose ] [Choose ] Stock O [Choose ]

You have been managing a $5 million portfolio that has a beta of 1.15 and a required rate of return of 9.025%. The current risk-free rate is 5%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 0.95, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places.   ___%

Assume that the stock market will be decreasing for the year and you are interested in investing in one of the following stocks. The two stocks are: Stock ABC with a Beta of 1.75 Stock 123 with a Beta of -0.8 If you want to maximize the value of the investment which stock should you acquire. Please explain.

Calculate the Sharpe ratio, Treynor ratio, M-squared and Jensen's alpha for a stock with an expected return of 11%, standard deviation of 16% and a market beta of 1.4. The expected market return is 9%, the standard deviation of the market return is 12% and the risk-free rate is 4%. Would you invest in this stock or not? (Your answer might change depending on your current portfolio allocation).

Stock Z is currently priced using an expected return of 16.8%. It has a beta of 1.15, and the risk-free rate is 3%. If the market risk premium is 12%, which of the following is CORRECT?     You should invest in this stock because, according to CAPM, it is underpriced     You should invest in this stock because, according to CAPM, it is overpriced     You should short sell this stock because, according to CAPM, it is overpriced     You should not invest in this stock because, according to CAPM, it is correctly priced

You have a portfolio with a standard deviation of 23% and an expected return of 17%. You are considering adding one of the two stocks in the following table: If after adding the stock you will have 25% of your money in the new stock and 75% of your money in your existing portfolio, which one should you add? Standard deviation of the portfolio with stock A is%. (Round to two decimal places.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Stock A Stock B Expected Return 16% 16% Print Standard Deviation 23% 18% C... Done Correlation with Your Portfolio's Returns 0.3 0.8 - X

You have been managing a $5 million portfolio that has a beta of 1.05 and a required rate of return of 6.675%. The current risk-free rate is 3%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 1.25, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places.