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In: Finance
A portfolio that combines the risk-free asset and the market portfolio has an expected return of...
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A portfolio that combines the risk-free asset and the market portfolio has an expected return of 6 percent and a standard deviation of 9 percent. The risk-free rate is 3 percent, and the expected return on the market portfolio is 11 percent. Assume the capital asset pricing model holds. |
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What expected rate of return would a security earn if it had a .35 correlation with the market portfolio and a standard deviation of 54 percent? |
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jeff jeffy answered 10 months agoRelated Solutions
A portfolio that combines the risk-free asset and the market portfolio has an expected return of...
A portfolio that combines the risk-free asset and the market
portfolio has an expected return of 6.7 percent and a standard
deviation of 9.7 percent. The risk-free rate is 3.7 percent, and
the expected return on the market portfolio is 11.7 percent. Assume
the capital asset pricing model holds.
What expected rate of return would a security earn if it had a .42
correlation with the market portfolio and a standard deviation of
54.7 percent? (Do not round intermediate calculations....
The market portfolio has expected return of 12% and risk of 19%, and the risk free...
The market portfolio has expected return of 12% and risk of 19%,
and the risk free rate is 5%. According to the capital market line
(the line that connects the risk free rate to efficient frontier),
what is the portfolio weight for the risky market portfolio if an
investor wants to achieve 8.5% return? What about 16.2%? And 19%
return?
The risk-free rate of return is 6%, the expected rate of return on the market portfolio...
The risk-free rate of return is 6%, the expected rate of return
on the market portfolio is 15%, and the stock of Xyrong Corporation
has a beta coefficient of 2.3. Xyrong pays out 45% of its earnings
in dividends, and the latest earnings announced were $9.00 per
share. Dividends were just paid and are expected to be paid
annually. You expect that Xyrong will earn an ROE of 18% per year
on all reinvested earnings forever.
a. What is the...
The risk-free rate of return is 10.0%, the expected rate of return on the market portfolio...
The risk-free rate of return is 10.0%, the expected rate of
return on the market portfolio is 17%, and the stock of Xyrong
Corporation has a beta coefficient of 1.6. Xyrong pays out 30% of
its earnings in dividends, and the latest earnings announced were
$15 per share. Dividends were just paid and are expected to be paid
annually. You expect that Xyrong will earn an ROE of 20% per year
on all reinvested earnings forever.
a. What is the...
The risk-free rate of return is 6%, the expected rate of return on the market portfolio...
The risk-free rate of return is 6%, the expected rate of return
on the market portfolio is 14%, and the stock of Xyrong Corporation
has a beta coefficient of 1.3. Xyrong pays out 50% of its earnings
in dividends, and the latest earnings announced were $8.00 per
share. Dividends were just paid and are expected to be paid
annually. You expect that Xyrong will earn an ROE of 15% per year
on all reinvested earnings forever.
a. What is the...
The risk-free rate of return is 9.0%, the expected rate of return on the market portfolio...
The risk-free rate of return is 9.0%, the expected rate of
return on the market portfolio is 14%, and the stock of Xyrong
Corporation has a beta coefficient of 2.0. Xyrong pays out 50% of
its earnings in dividends, and the latest earnings announced were
$20 per share. Dividends were just paid and are expected to be paid
annually. You expect that Xyrong will earn an ROE of 18% per year
on all reinvested earnings forever.
a. What is the...
The risk-free rate of return is 9.0%, the expected rate of return on the market portfolio...
The risk-free rate of return is 9.0%, the expected rate of
return on the market portfolio is 14%, and the stock of Xyrong
Corporation has a beta coefficient of 2.0 resulting in a required
rate of return of 19.00%. Xyrong pays out 50% of its earnings in
dividends, and the latest earnings announced were $20 per share.
Dividends were just paid and are expected to be paid annually. You
expect that Xyrong will earn an ROE of 18% per year...
The market portfolio has an expected return of 9% and standard deviation of 25%. The risk-free...
The market portfolio has an expected return of 9% and standard
deviation of 25%. The risk-free rate is 3%. Bob has $300 to invest.
What is the standard deviation of Bob's portfolio if he borrows
$100 and invests $400 in the market portfolio?
a. 33.33%
b. 25.00%
c. 28.33%
d. 16.67%
e. 37.50%
Suppose the risk-free rate is 5.2 percent and the market portfolio has an expected return of...
Suppose the risk-free rate is 5.2 percent and the market
portfolio has an expected return of 11.9 percent. The market
portfolio has a variance of .0482. Portfolio Z has a correlation
coefficient with the market of .38 and a variance of .3385
According to the capital asset pricing model, what is the
expected return on Portfolio Z? (Do not round intermediate
calculations. Enter your answer as a percent rounded to 2 decimal
places (e.g., 32.16).)
Expected return
????? %
Suppose the risk-free rate is 4.10% and the market portfolio has an expected return of 11.25%....
Suppose the risk-free rate is 4.10% and the market portfolio has
an expected return of 11.25%. A portfolio is invested equally in
three securities with betas of 0.38, 1.13, and 1.18 respectively.
What is the expected return on this portfolio?
Question 16 options:
10.48%
10.74%
11.00%
11.26%
11.52%
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