Homework Help is Here – Start Your Trial Now!
Business
Finance
You have joined PMS division of Motilal Oswal broking firm as a manager. Your job profile includes the manging portfolios of valuable clients. One of the clients is having four companies in his portfolio as per weights given below  Company Weights alpha Systematic Risk (%2) Unsystematic Risk (%2) HUL 0.15 0.47 18.49 35 Axis Bank 0.30 2.48 46.93 20 TCS 0.25 1.02 27.56 40 Tata Motors 0.30 1.27 56.25 50    Expected return from Nifty is 20 % and variance of its return is 25 percent square. Calculate the expected portfolio return and the portfolio risk using Sharpe’s Single Index Model

You have joined PMS division of Motilal Oswal broking firm as a manager. Your job profile includes the manging portfolios of valuable clients. One of the clients is having four companies in his portfolio as per weights given below  Company Weights alpha Systematic Risk (%2) Unsystematic Risk (%2) HUL 0.15 0.47 18.49 35 Axis Bank 0.30 2.48 46.93 20 TCS 0.25 1.02 27.56 40 Tata Motors 0.30 1.27 56.25 50    Expected return from Nifty is 20 % and variance of its return is 25 percent square. Calculate the expected portfolio return and the portfolio risk using Sharpe’s Single Index Model

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
See similar textbooks
icon
Related questions
Question

You have joined PMS division of Motilal Oswal broking firm as a manager. Your job profile includes the manging portfolios of valuable clients. One of the clients is having four companies in his portfolio as per weights given below 

Company

Weights

alpha

Systematic Risk (%2)

Unsystematic Risk (%2)

HUL

0.15

0.47

18.49

35

Axis Bank

0.30

2.48

46.93

20

TCS

0.25

1.02

27.56

40

Tata Motors

0.30

1.27

56.25

50 

 

Expected return from Nifty is 20 % and variance of its return is 25 percent square. Calculate the expected portfolio return and the portfolio risk using Sharpe’s Single Index Model 

Expert Solution
steps

Step by step

Solved in 3 steps with 2 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Effect Of Risk Management
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Essentials Of Investments
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
FUNDAMENTALS OF CORPORATE FINANCE
FUNDAMENTALS OF CORPORATE FINANCE
Finance
ISBN:
9781260013962
Author:
BREALEY
Publisher:
RENT MCG
Financial Management: Theory & Practice
Financial Management: Theory & Practice
Finance
ISBN:
9781337909730
Author:
Brigham
Publisher:
Cengage
Foundations Of Finance
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS