BETA Expected Rate of Return (CAPM) Precent of Portfolio IBM 0.86 8% 10% KO 0.66 6%...
| BETA | Expected Rate of Return (CAPM) | Precent of Portfolio | |
| IBM | 0.86 | 8% | 10% |
| KO | 0.66 | 6% | 10% |
| NFLX | 1.57 | 14% | 40% |
| AKAM | 1.34 | 12% | 30% |
| IWM | 1.15 | 10% | 10% |
| Portfolio Standard Deviation | |||
| Portfolio Required rate of return | |||
What is the standard deviation of this portfolio and how would I solve for it?
What is the required rate of return of this portfolio and how would I solve for it?
Homework Answers
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BETA
Expected Rate of Return (CAPM)
Precent of Portfolio
IBM
0.86
8%
10%
KO
0.66
6%...
Based on this portfolio what is the portfolios beta? Portfolio standard deviation? And portfolios expected return?...
Based on this portfolio what is the portfolios beta? Portfolio standard deviation? And portfolios expected return? Beta Expected Rate of Return (CAPM) Portfolio Weight SPY 1 9.00% 0.2 LQD -0.02 0.59% 0.05 HYG 0.38 3.89% 0.15 IBM 0.86 7.85% 0.1 KO 0.66 6.20% 0.2 BIG 1.04 9.33% 0.1 NFLX 1.57 13.70% 0.2 What is the Portfolio Beta? And formula to calculate it? What is the Portfolio Standard Deviation and formula to find it? Portfolio Expected Return? And formula to calculate...
Suppose Intel stock has a beta of 1.57, whereas Boeing stock has a beta of 0.86....
Suppose Intel stock has a beta of 1.57, whereas Boeing stock has a beta of 0.86. If the risk-free interest rate is 6.4% and the expected return of the market portfolio is 12.8%, according to the CAPM, a. What is the expected return of Intel stock? b. What is the expected return of Boeing stock? c. What is the beta of a portfolio that consists of 65% Intel stock and 35% Boeing stock? d. What is the expected return of...
According to the CAPM, what must be the beta of a portfolio with expected return 0.25,...
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Expected Portfolio Return Beta 22 0.8 A Market 173 1.0 D) Expected Portfolio Return Beta 30.28 1.8 A Market 198 1.0 If...
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7. (10 points) If the return on the market portfolio is expected to be 11% next year, IBM Inc. has a beta of 1.4, and the risk free rate is 3%. Suppose you conduct your own security analysis, and find that the expected retum for IBM next year should be 17%. A 16 points) What is the alpha of IBM when you use CAPM? B. (4 points) Would you buy or short sell IBM? Explain.
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CAPM and portfolio return You have been managing a $5 million portfolio that has a beta of 1.50 and a required rate of r...
CAPM and portfolio return You have been managing a $5 million portfolio that has a beta of 1.50 and a required rate of return of 14%. The current risk-free rate is 5.00%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 1.45, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places.
Problem 8-16 CAPM and portfolio return You have been managing a $5 million portfolio that has...
Problem 8-16 CAPM and portfolio return You have been managing a $5 million portfolio that has a beta of 1.50 and a required rate of return of 15%. The current risk-free rate is 5.00%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 1.15, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places.
CAPM, portfolio risk, and return Consider the following information for three stocks, Stocks A, B...
CAPM, portfolio risk, and return Consider the following information for three stocks, Stocks A, B, and C. The returns on the three stocks are positively correlated, but they are not perfectly correlated. (That is, each of the correlation coefficients is between 0 and 1.) Stock Standard Deviation 14% 14 14 Beta 0.9 1.3 1.7 Expected Return 9.60 % 11.42 13.24 Fund P has one-third of its funds invested in each of the three stocks. The risk-free rate is 5.5%, and...
Expected return of a portfolio using beta. The beta of four stocks-G, H, I, and J...
Expected return of a portfolio using beta. The beta of four stocks-G, H, I, and J are 0.44, 0.78, 1.11, and 1.67, respectively and the beta of portfolio 1 is 1.00, the beta of portfolio 2 is 0.83, and the beta of portfolio 3 is 1.15. What are the expected returns of each of the four individual assets and the three portfolios if the current SML is plotted with an intercept of 3.0% (risk-free rate) and a market premium of...
Suppose Intel stock has a beta of 1.57, whereas Boeing stock has a beta of 0.86. If the risk-free interest rate is 6.4% and the expected return of the market portfolio is 12.8%, according to the CAPM, a. What is the expected return of Intel stock? b. What is the expected return of Boeing stock? c. What is the beta of a portfolio that consists of 65% Intel stock and 35% Boeing stock? d. What is the expected return of...
Expected Portfolio Return Beta 22 0.8 A Market 173 1.0 D) Expected Portfolio Return Beta 30.28 1.8 A Market 198 1.0 If the simple CAPM is valid and all portfolios are priced correctly, which of the situations below is possible? Consider each situation independently, and assume the risk-free rate is 5% A) Expected Portfolio Return Beta 198 0.8 Market 198 1.0 B) Expected Standard Return Deviation Portfolio 228 88 A Market 17B 168
7. (10 points) If the return on the market portfolio is expected to be 11% next year, IBM Inc. has a beta of 1.4, and the risk free rate is 3%. Suppose you conduct your own security analysis, and find that the expected retum for IBM next year should be 17%. A 16 points) What is the alpha of IBM when you use CAPM? B. (4 points) Would you buy or short sell IBM? Explain.
Problem 8-16 CAPM and portfolio return You have been managing a $5 million portfolio that has a beta of 1.50 and a required rate of return of 15%. The current risk-free rate is 5.00%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 1.15, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places.
CAPM, portfolio risk, and return Consider the following information for three stocks, Stocks A, B, and C. The returns on the three stocks are positively correlated, but they are not perfectly correlated. (That is, each of the correlation coefficients is between 0 and 1.) Stock Standard Deviation 14% 14 14 Beta 0.9 1.3 1.7 Expected Return 9.60 % 11.42 13.24 Fund P has one-third of its funds invested in each of the three stocks. The risk-free rate is 5.5%, and...
Expected return of a portfolio using beta. The beta of four stocks-G, H, I, and J are 0.44, 0.78, 1.11, and 1.67, respectively and the beta of portfolio 1 is 1.00, the beta of portfolio 2 is 0.83, and the beta of portfolio 3 is 1.15. What are the expected returns of each of the four individual assets and the three portfolios if the current SML is plotted with an intercept of 3.0% (risk-free rate) and a market premium of...
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