Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
BHAVNAGAR
Transcribed Image Text:As an Investment Manager you are given the following Information
Invest in
Equity
Shares/
Initial
Securities price
Cement
Ltd
Steel Ltd
Liqour Ltd
GOI Bonds
29
38
46
1030
Mkt price at
the end of
Dividends the year
4
4
4
155
II) Average return of the portfolio
Risk free rate is 16%
54
65
145
1040
Beta
Risk
Factor
You are required to calculate
i) Expected rate of return of portfolio in each case using
CAPM
0.9
0.8
0.7
1
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