The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%. Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

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Answer 1

Question

Chapter 24, Problem 15PS

A

Summary Introduction

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%.

Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

B

Summary Introduction

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat.

Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.

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A portfolio manager is running a strategy whose tracking error last year was close to zero. Based on this information only, can you comment on how successful this strategy is? More generally, provide the definition of tracking error and describe briefly whether a high or low tracking error is preferred, and why.

When working with the CAPM, which of the following factors can be determined with the most precision? a. The beta coefficient of "the market," which is the same as the beta of an average stock. b. The beta coefficient, bi, of a relatively safe stock. c. The market risk premium (RPM). d. The most appropriate risk-free rate, rRF. e. The expected rate of return on the market, rM.

please help me check my work and anything unsolved, thanks

Answer 2

Question

Chapter 24, Problem 15PS

A

Summary Introduction

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%.

Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

B

Summary Introduction

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat.

Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 24, Problem 15PS

A

Summary Introduction

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%.

Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

B

Summary Introduction

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat.

Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 24, Problem 15PS

A

Summary Introduction

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%.

Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

B

Summary Introduction

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat.

Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 5

Chapter 24, Problem 15PS

A

Summary Introduction

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%.

Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

B

Summary Introduction

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat.

Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.

Answer 6

Chapter 24, Problem 15PS

A

Summary Introduction

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%.

Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

Answer 7

Chapter 24, Problem 15PS

A

Summary Introduction

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%.

Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

Answer 8

B

Summary Introduction

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat.

Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.

Answer 9

B

Summary Introduction

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat.

Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.

Answer 10

Expert Solution & Answer

Answer 11

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Answer 12

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Answer 13

Ch. 24 - Prob. 1PS Ch. 24 - Prob. 2PS Ch. 24 - Prob. 3PS Ch. 24 - Prob. 4PS Ch. 24 - Prob. 5PS Ch. 24 - Prob. 6PS Ch. 24 - Prob. 7PS Ch. 24 - Prob. 8PS Ch. 24 - Prob. 9PS Ch. 24 - Prob. 10PS

The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%. Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

Solution Summary: The author calculates the value of alpha on the basis of manager's portfolio, based on beta, T-bill return, and market return value.

Concept explainers

Videos

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%.

Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat.

Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.

Want to see the full answer?

Chapter 24 Solutions

The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%. Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

Solution Summary: The author calculates the value of alpha on the basis of manager's portfolio, based on beta, T-bill return, and market return value.

Concept explainers

Videos

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%. Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat. Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.

Want to see the full answer?

Chapter 24 Solutions

To calculate: The value of alpha on the basis of manager’s portfolio. When the T-bill rate was 6%, market return was 14% and portfolio manager with beta of 0.5 having return of 10%.

Introduction: The value of alpha depends on the value of beta, T-bill return, and market return value.

To explain: Effect of the alpha value on the performance of portfolio when the security market line is too flat.

Introduction: When it comes to performance analysis, then beta value gives a high imact on performance.