Director of finance to put together a plan

Assignment Help Other Subject
Reference no: EM13919247

You have been asked by the director of finance to put together a plan to invest in other companies. Your plan will manage a mutual fund with a $20 million portfolio with a beta of 1.50. Assume that the risk-free rate is 4.50%, and the market risk premium is 5.50%. You expect to receive an additional $5 million, which you plan to invest in a number of stocks. After investing the additional funds, you want the fund's required return to be 13%.

  • What must the average beta of the new stocks added to the portfolio be to achieve the desired required rate of return? Attach your Excel file showing your calculations. 
  • In a Word document, explain the steps you used to arrive at your answers-Must be 2 pages lone
  • What does your calculated beta mean to UPC? 
  • Should UPC be concerned about the use of betas in making investment decisions?

Reference no: EM13919247

Questions Cloud

Probability of getting heads on only one of your flips : You flip a coin three times. (a) What is the probability of getting heads on only one of your flips? (b) What is the probability of getting heads on at least one flip?
Working capital simulation in managing growth : Acting as the CEO of a small company, you will apply the principles of capital budgeting to invest in growth and cash flow improvement opportunities in three phases over 10 simulated years. Each opportunity has a unique financial profile and you m..
What is the breakeven point for solutions plus : What is the breakeven point for Solutions Plus? That is, how low can the company go on its bid without losing money?
How easy would it be to imitate this strategy : Describe Southwest Airlines strategy (using five generic strategies, and operating strategies (Hub and Spoke, Point-to-Point, and Grid, cost management (fuel, labor, cabin, aircraft, etc.) from 2007-2010 . Major strenghts that make the company pro..
Director of finance to put together a plan : You have been asked by the director of finance to put together a plan to invest in other companies. Your plan will manage a mutual fund with a $20 million portfolio with a beta of 1.50.
Total stockholders equity : Total stockholders' equity at December 31, 2014 was $236,000.
Building loyal customer relationships across different group : Write a 750- to 1,000-word paper in which you identify your favorite brand and explain why it is your favorite. In the paper you should do the following:
Manufacturing and distribution in another country : You represent a large U.S. corporation that manufactures rubber tires, and you want to begin manufacturing and distribution in another country. Choose a country that you think you would want to start a manufacturing plant in. Answer the following ..
The unit contribution margin : The sales mix in units for the period is 70% for A and 30 % for B. If the unit contribution margin for A is $8.02 and the unit contribution margin for B is $5.37

Reviews

Write a Review

Other Subject Questions & Answers

  Each group must have students who represent both sides of

each group must have students who represent both sides of the legal issue in each case and must prepare a legal

  Explain descriptive statistics and inferential statistics

Write down descriptive statistics and what are inferential statistics? Write down the similarities between descriptive and inferential statistics? Write down the differences?

  Summer school courses based on anticipated enrollment

A university schedules summer school courses based on anticipated enrollment. The cost for faculty compensation, laboratories, student services, and allocated overhead for a computer class is $8500.

  Short-term versus long-term memory

This article will define memory, including the different types of memory. We will explain the different between short-term and long-term memory. The theories behind motivation will be explored as well as the theories behind emotions.

  Legal and ethical concerns in the case

As the supervisor of this counselor trainee, what are your immediate legal and ethical concerns in this case?

  In what ways are the notions of god similar in christianity

As you are composing your response to this discussion, consider the following questions: How does the notion of God in Christianity differ from the notion of God in Islam? In what ways are the notions of God similar in Christianity and Islam

  Which nervous system structures involved in sensory system

Create a 3-slide Microsoft PowerPoint presentation including detailed speaker notes. The Topic: is the neurological sense of Touch. Identify which nervous system structures are involved in that sensory system

  Effects of duchenne''s muscular dystrophy

What are 3 main symptoms, treatments and effects of Duchenne's Muscular Dystrophy?

  Implementation of sorting activities

After reading chapter 17 in 50 Strategies for Teaching English Language Learners, choose a curriculum area and a grade level you hope to teach. Using the steps listed in the text regarding the implementation of sorting activities, explain how you ..

  Disadvantages of the media''s role in reporting terrorist

Discuss the advantages and disadvantages of the media's role in reporting terrorist activity.

  Outline the essential steps that shimon kornfield taken

Outline the essential steps that Shimon Kornfield could have taken in order to endure that all team members learned of any proposed changes. Provide the rationale and justification for each step outlined.

  What is the economic situation

What is the economic situation. Prepare an analysis of funding levels for the U.S. Government and its Department of Education, identify trends as you look at the 2010 actual, and 2011 and 2012 amounts for outlays and receipts

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd