HLCM and PHN has a beta of 1.50 and 2, respectively. The average return on the market is 9.50% and it is 5% greater than the risk-free rate. The portfolio beta of investment held by Bulldogs Inc. is 2. What is the beta of stock MWIDE?
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Bulldogs Inc. has an investment fund amounting to P4,500,000. The portfolio consists of three stocks within the retail industry. P1,350,000 is invested in HLCM, 45% in MWIDE and the remaining in PHN. HLCM and PHN has a beta of 1.50 and 2, respectively. The average return on the market is 9.50% and it is 5% greater than the risk-free rate. The portfolio beta of investment held by Bulldogs Inc. is 2.
What is the beta of stock MWIDE?
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- Thank youCurrently the rate of return of the risk-free government bond is 3% while the expected rate of return on the market is 11%. Using CAPM, calculate the rate of return required for A plc who has a beta of 0.8 and B plc who has a beta of 1.35. If you create a portfolio with 40% of funds in A plc and the remainder in B what return would you expect?You have just invested in a portfolio of three stocks. The amount of money that you invested in each stock and its beta are summarized below. Stock A B C Investment $196,000 294,000 490,000 Beta Expected rate of return 1.50 0.55 1.35 Calculate the beta of the portfolio and use the Capital Asset Pricing Model (CAPM) to compute the expected rate of return for the portfolio. Assume that the expected rate of return on the market is 18 percent and that the risk-free rate is 9 percent. (Round beta answer to 3 decimal places, e.g. 52.750 and expected rate of return answer to 2 decimal places, e.g. 52.75%) Beta of the portfolio %
- The average return on the Market is 12% while the market risk premium is 7%. What is the require rate of return of the portfolio? (In percentage) Blue Co. has a collection of shares that is publicly trade. The value of each security and its stock beta are as follows: stock Investment Beta CEB 3,000,000 2 SMC 3,000,000 1.2 SCC 800,000 .5 MTB 1,200,000 1In addition to risk-free securities, you are currently invested in the TanglewoodFund, a broad-based fund of stocks and other securities with an expected return of 14% and a volatility of 24%. Currently, the risk-free rate of interest is 3%. Your broker suggests that you add a venture capital fund to your current portfolio. The venture capital fund has an expected return of 20%, a volatility of 79 %, and a correlation of 0.2 with the Tanglewood Fund. Assume you follow your broker's advice and put 50% of your money in the venture fund: a. What is the Sharpe ratio of the Tanglewood Fund? Answer (Already calculated): Sharpe ratio of the Tanglewood Fund is: 0.458 b. What is the Sharpe ratio of your new portfolio? c. What is the optimal Sharpe ratio you can obtain by investing in the venturefund? (Hint: Use Excel and round your answer to three decimal places.) Please use excel for last question, four people from chegg has gotten this question wrong. Please get it rightCompany Q has earnings of $3.00 per share, a market price of $25, and a beta of 1.25. The risk-free rate is 3% and the risk premium for the market as a whole is 5%. What is the current rate of return for investing in company Q? What is the current "reward-to-risk ratio" for Company Q?
- You plan to invest in the Kish Hedge Fund, which has total capital of $500 million invested in five stocks: Stock A B C D E Kish's beta coefficient can be found as a weighted average of its stocks' betas. The risk-free rate is 4%, and you believe the following probability distribution for future market returns is realistic: Investment $160 million 120 million 80 million 80 million 60 million Probability 0.1 0.2 0.4 0.2 0.1 a. What is the equation for the Security Market Line (SML)? (Hint: First determine the expected market return.) Stock's Beta Coefficient 0.4 1.0 1.8 1.0 1.3 -Select- ◆ Market Return I. r₁ = 3.8% + (10.1%) bi II. r = 4.0% + (9.6%)bi III. r₁ = 5.9% + (9.3%)bi IV. r₁ = 5.9% + (9.6%)bi V. r₁ = 4.0% + (9.3%)bi -24% 0 11 30 53 b. Calculate Kish's required rate of return. Do not round intermediate calculations. Round your answer to two decimal places. % c. Suppose Rick Kish, the president, receives a proposal from a company seeking new capital. The amount needed to take a…You have assigned the following values to these three firms: Upcoming Dividend $0.50 Estee Lauder Kimco Realty Nordstrom Price $36.00 75.00 11.00 1.58 2.00 Estee Lauder required return Kimco Realty required return Nordstrom required return Assume that the market portfolio will earn 17.20 percent and the risk-free rate is 8.20 percent. Compute the required return for each company using both CAPM and the constant-growth model. (Do not round intermediate calculations and round your final answers to 2 decimal places.) CAPM Growth 11.40% 17.00 8.80 % % % Beta 0.92 1.28 1.24 Constant-Growth Model % % %Consider a portfolio with stocks A, B, and C. The total value of the portfolio is $245,000 and it is fully invested in these 3 stocks. $85,653 is invested in A and $69,552 is invested in B. The Betas of stocks A, B, and C are 1.2, .8, and 1.62, respectively. What is the Beta of the portfolio overall?
- You plan to invest in the Kish Hedge Fund, which has total capital of $500 million invested in five stocks: Stock Investment Stock's Beta Coefficient A $160 million 0.7 B 120 million 1.4 C 80 million 2.1 D 80 million 1.0 E 60 million 1.4 Kish's beta coefficient can be found as a weighted average of its stocks' betas. The risk-free rate is 4%, and you believe the following probability distribution for future market returns is realistic: Probability Market Return 0.1 -26% 0.2 0 0.4 13 0.2 30 0.1 50 What is the equation for the Security Market Line (SML)? (Hint: First determine the expected market return.) ri = 5.7% + (9.6%)bi ri = 5.7% + (9.5%)bi ri = 4.0% + (9.6%)bi ri = 2.1% + (9.0%)bi ri = 4.0% + (9.5%)bi Calculate Kish's required rate of return. Do not round intermediate calculations. Round your answer to two decimal places. % Suppose Rick Kish, the president, receives a proposal from a company seeking new capital. The amount needed to take a…sofie Inc. has an investment fund amounting to P4,500,000. The portfolio consists of three stocks within the retail industry. P1,350,000 is invested in HLCM, 45% in MWIDE and the remaining in PHN. HLCM and PHN has a beta of 1.50 and 2, respectively. The average return on the market is 9.50% and it is 5% greater than the risk-free rate. The portfolio beta of investment held by Bulldogs Inc. is 2.What is the portfolio’s required rate of return?You plan to invest in the Kish Hedge Fund, which has total capital of $500 million invested in five stocks: Investment Stock Stock's Beta Coefficient A $160 million 0.7 B 120 million 1.5 с 80 million 2.2 D E 80 million 60 million 1.0 1.4 Kish's beta coefficient can be found as a weighted average of its stocks' betas. The risk-free rate is 4%, and you believe the following probability distribution for future market returns is realistic: Probability Market Return 0.1 -28% 0.2 0 0.4 13 0.2 0.1 32 48 a. What is the equation for the Security Market Line (SML)? (Hint: First determine the expected market return.) I. n = 1.5% + (11.5%)bi II. 4.0% + (10.9%) bi III. n = 5.5% + (9.6%) bi IV. n = 5.5% + (10.9%)bi V. n = 4.0% + (9.6%)bi V v b. Calculate Kish's required rate of return. Do not round intermediate calculations. Round your answer to two decimal places. 16.13% c. Suppose Rick Kish, the president, receives a proposal from a company seeking new capital. The amount needed to take a position…
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