The share with the least systematic risk and it's CAPM return is The share with the most systematic risk and it's CAPM return is 4 4

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
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9

Question: RRII
Your next task as a portfolio manager is to analyse the systematic risk of the following securities:
ABL
9%
5%
2%
1%
6%
ZZC
12%
14%
11%
10%
9%
Given that government bonds are yielding 2.5% and the return of the market can be calculated from the average of the ASX200
index returns given above:
The share with the least systematic risk and it's CAPM return is
The share with the most systematic risk and it's CAPM return is
→
ASX200
10%
12%
9%
8%
7%
◆
◆
A popular YouTube financial analyst Sarah Sneaky, claims that the return of both ABL and ZZC to be 7%. Sarah is
ABL as her discount rate used for valuation is
Sarah is
ZZC as her discount rate used for valuation is
+
◆
◆
Transcribed Image Text:Question: RRII Your next task as a portfolio manager is to analyse the systematic risk of the following securities: ABL 9% 5% 2% 1% 6% ZZC 12% 14% 11% 10% 9% Given that government bonds are yielding 2.5% and the return of the market can be calculated from the average of the ASX200 index returns given above: The share with the least systematic risk and it's CAPM return is The share with the most systematic risk and it's CAPM return is → ASX200 10% 12% 9% 8% 7% ◆ ◆ A popular YouTube financial analyst Sarah Sneaky, claims that the return of both ABL and ZZC to be 7%. Sarah is ABL as her discount rate used for valuation is Sarah is ZZC as her discount rate used for valuation is + ◆ ◆
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