Question

In: Finance

stock return std a. 10% 20% b. 19% 29% correlation is 0.4. risk free rate is...

stock return std

a. 10% 20%

b. 19% 29%

correlation is 0.4. risk free rate is 2%

find the optimal portfolio using a and b. find the exp return and standard deviation of the portfolio.

Solutions

Expert Solution

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

jeff jeffy answered 1 year ago
Next > < Previous

Related Solutions

A stock has a required return of 10%, the risk-free rate is 4.5%, and the market...
A stock has a required return of 10%, the risk-free rate is 4.5%, and the market risk premium is 2%. What is the stock's beta? Round your answer to two decimal places. If the market risk premium increased to 6%, what would happen to the stock's required rate of return? Assume that the risk-free rate and the beta remain unchanged. Do not round intermediate calculations. Round your answer to two decimal places. If the stock's beta is equal to 1.0,...
URGENT! A stock currently has a market value of $10. The risk-free rate of return is...
URGENT! A stock currently has a market value of $10. The risk-free rate of return is 3%. In one year, the stock is expected to sell for either $14 or $9. a) What is the value of a twelve-month call option with a strike price of $12? (6 points) b) If the twelve-month call option is traded at $1.2, Recommend a riskless strategy by showing the positions in both shares and calls. (4 points).
A stock currently has a market value of $10. The risk-free rate of return is 3%....
A stock currently has a market value of $10. The risk-free rate of return is 3%. In one year, the stock is expected to sell for either $14 or $9. a) What is the value of a twelve-month call option with a strike price of $12? (6 points) b) If the twelve-month call option is traded at $1.2, Recommend a riskless strategy by showing the positions in both shares and calls. (4 points).
A stock currently has a market value of $10. The risk-free rate of return is 3%....
A stock currently has a market value of $10. The risk-free rate of return is 3%. In one year, the stock is expected to sell for either $14 or $9. a) What is the value of a twelve-month call option with a strike price of $12? (6 points) b) If the twelve-month call option is traded at $1.2, Recommend a riskless strategy by showing the positions in both shares and calls. (4 points).
The risk free rate is 5% and the market rate of return is 8%. Stock A...
The risk free rate is 5% and the market rate of return is 8%. Stock A has a beta value =0.5. Required: (A). Draw the Security Market Line (SML) clearly indicating the risk free asset, market and stock A.[12marks].(B) Stock A beginning price is K50 and during the year paid a dividend of k3 with a maturity value of k55. Show using an empirical evidence weather stock A is undervalued, overvalued of fairly valued.[8marks]
If the risk-free rate is 5% and the return on the market is 10%, what is...
If the risk-free rate is 5% and the return on the market is 10%, what is alpha equal to for a stock with a beta of 2 that has an expected return of 15%?
Beta and required rate of return A stock has a required return of 12%; the risk-free...
Beta and required rate of return A stock has a required return of 12%; the risk-free rate is 2.5%; and the market risk premium is 3%. What is the stock's beta? Round your answer to two decimal places. B. If the market risk premium increased to 9%, what would happen to the stock's required rate of return? Assume that the risk-free rate and the beta remain unchanged. 1. If the stock's beta is equal to 1.0, then the change in...
Stock A has a beta of 1.5, the risk-free rate is 4% and the return on...
Stock A has a beta of 1.5, the risk-free rate is 4% and the return on the market is 9%. If inflation changes by -2%, by how much will the required return on Stock A change?
Stock A has a beta of 0, the risk-free rate is 4% and the return on...
Stock A has a beta of 0, the risk-free rate is 4% and the return on the market is 9%. If the market risk premium changes by 8%, by how much will the required return on Stock A change?
Assume that the risk-free rate is 2.5% and the required return on the market is 10%....
Assume that the risk-free rate is 2.5% and the required return on the market is 10%. What is the required rate of return on a stock with a beta of 2.1? Round your answer to two decimal places.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT