e of return of 5% over the next year. Also, information from an investment advising service lists the current beta for TI as 1.68 and for SG as 0.52. You are provided a series of questions to guide your analysis. Economy Probability TI SG market Recession 30% -20% 5% -4% Average 20% 15% 6% 11% Expansion 35% 30% 8% 17% Boom 15% 50% 10% 27% 6. If you form a two-stock portfolio by investing RM70,000 in TI and RM30,000 in SG, what is the portfolio beta and expected rate of
As a financial advisor at ABC Corporation, the CEO asked you to analyze the following
information pertaining to two common stock investments, TI and SG. You are told that a oneyear Treasury Bill will have a
an investment advising service lists the current beta for TI as 1.68 and for SG as 0.52. You are
provided a series of questions to guide your analysis.
|
Economy |
Probability |
TI |
SG |
market |
|
Recession |
30% |
-20% |
5% |
-4% |
|
Average |
20% |
15% |
6% |
11% |
|
Expansion |
35% |
30% |
8% |
17% |
|
Boom |
15% |
50% |
10% |
27% |
6. If you form a two-stock portfolio by investing RM70,000 in TI and RM30,000 in SG, what
is the portfolio beta and expected rate of return?
6. If you form a two-stock portfolio by investing RM70,000 in TI and RM30,000 in SG, what
is the portfolio beta and expected rate of return?
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