Consider a portfolio that comprise of 35% INP-INVESTEC PLC stock, 35% INLINVESTEC LTD stock, and 30% DRD-DRD Gold stock. INP-INVESTEC PLC has a beta of 1, INL-INVESTEC LTD has a beta of 3.0, and DRD-DRD Gold has a beta of 0.5. The risk free asset currently offer a return of 4%, and the expected return on the market is 11.5%. What return should you expect on your portfolio according to the CAPM?

Consider a portfolio that comprise of 35% INP-INVESTEC PLC stock, 35% INLINVESTEC LTD stock, and 30% DRD-DRD Gold stock. INP-INVESTEC PLC has a beta of 1, INL-INVESTEC LTD has a beta of 3.0, and DRD-DRD Gold has a beta of 0.5. The risk free asset currently offer a return of 4%, and the expected return on the market is 11.5%. What return should you expect on your portfolio according to the CAPM?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 25P

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