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Data table Portfolio Weightings Asset Beta A 2.30 B 0.95 C 0.60 D - 1.80 (Click on the icon in order to copy its contents into a spreadsheet) First Portfolio 15% 15% 35% 35% Second Portfolio 35% 35% 15% 15%

Data table Portfolio Weightings Asset Beta A 2.30 B 0.95 C 0.60 D - 1.80 (Click on the icon in order to copy its contents into a spreadsheet) First Portfolio 15% 15% 35% 35% Second Portfolio 35% 35% 15% 15%

Essentials Of Investments
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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(Portfolio beta and CAPM) You are putting together a portfolio made up of four different stocks. However, you are considering two possible weightings: a. What is the beta on each portfolio? b. Which portfolio is riskier? c. If the risk-free rate of interest were 5 percent and the market risk premium were 6.5 percent, what rate of return would you expect to earn from each of the portfolios? a. The beta on the first portfolio is (Round to three decimal places.)
Transcribed Image Text:(Portfolio beta and CAPM) You are putting together a portfolio made up of four different stocks. However, you are considering two possible weightings: a. What is the beta on each portfolio? b. Which portfolio is riskier? c. If the risk-free rate of interest were 5 percent and the market risk premium were 6.5 percent, what rate of return would you expect to earn from each of the portfolios? a. The beta on the first portfolio is (Round to three decimal places.)
Data table Asset Beta 2.30 0.95 0.60 D - 1.80 (Click on the icon in order to copy its contents into a spreadsheet.) ABC Portfolio Weightings A First Portfolio 15% 15% 35% 35% Second Portfolio 35% 35% 15% 15%
Transcribed Image Text:Data table Asset Beta 2.30 0.95 0.60 D - 1.80 (Click on the icon in order to copy its contents into a spreadsheet.) ABC Portfolio Weightings A First Portfolio 15% 15% 35% 35% Second Portfolio 35% 35% 15% 15%
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