Calculate your portfolio''s new beta

Assignment Help Finance Basics
Reference no: EM131100686

Suppose you hold a diversified portfolio consisting of a $7,500 investment in each of 20 different common stocks. The portfolio beta is equal to 1.12. Now, suppose you have decided to sell one of the stocks in your portfolio with a beta equal to 1.0 for $7,500 and to use these proceeds to buy another stock for your portfolio. Assume the new stock's beta is equal to 1.75. Calculate your portfolio's new beta.

Reference no: EM131100686

Questions Cloud

Marketing plan guidelines : You will complete an analysis of the company you selected related to their B2B strategy. It is your responsibility to develop a "re-branding" strategy for your selected company that should consist of the following components:
What will be the new beta of your portfolio : You have a $2 million portfolio consisting of a $100,000 investment in each of 20 different stocks. The portfolio has a beta equal to 1.1. You are considering selling $100,000 worth of one stock which has a beta equal to 0.9 and using the proceeds to..
The nonbasic variables in the optimal bf solution : (b) Reformulate this problem as an equivalent transportation problem by constructing the appropriate parameter table.
How theory applies to this individual leadership approach : A detailed description of how the theory applies to this individual's leadership approach (e.g., if choosing transformational leadership, you should analyze and report on idealized influence, individualized consideration, etc.)
Calculate your portfolio''s new beta : Suppose you hold a diversified portfolio consisting of a $7,500 investment in each of 20 different common stocks. The portfolio beta is equal to 1.12. Now, suppose you have decided to sell one of the stocks in your portfolio with a beta equal to 1.0 ..
Current web starting page on the computer : What is your current Web starting page on the computer you use most frequently (i.e., what's the address of the page that displays when you open your browser)? If you use more that one device or browser regularly, do they all use the same page or ..
Discuss common patient concerns with particular medication : Discuss how you, as the primary provider, would present the treatment options to your patient and discuss common patient concerns with the particular medication or treatment modality.
How would describe macroeconomic worldview of david ricardo : How would you describe the macroeconomic "worldview" of David Ricardo, Karl Marx, and John Stuart Mill?
Marginal cost of production : Titan inc. is the sole producer of a specialized chip. It has estimated that the elasticity of demand for the chip is -1.5. The marginal cost of production is $500.

Reviews

Write a Review

Finance Basics Questions & Answers

  Represent academic ethics and integrity

Create a list of at least 10 guiding principles that you currently engage in or follow and describe how they can represent academic ethics and integrity.

  The company has 12 million interest expense and the

cox corporation recently reported an ebitda of 58 million and 7 million of net income. the company has 12 million

  A general motors bond carries a coupon rate of 8 percent

a general motors bond carries a coupon rate of 8 percent has 9 years until maturity and sells at a yield to maturity

  What would be the present value of these bonds

if the required rate of return in the market is 5% per annum and the bonds have 15 years left to maturity. Assume a face value (maturity value) of $1,000.

  Crafts boat shop for several years now and have been very

crafts boat shop for several years now and have been very successful. you have come to the point where you expect sales

  What is an incremental cash flow for a project what

what is an incremental cash flow for a project? what concepts do we need to examine to help understand how to estimate

  Find and present a specific example of impact

Find and present a specific example of the impact of each type of investment risk. In each case, how did the type of risk affect investment performance?

  What is the bonds yield to maturity

A 10 year maturity bond with a coupon rate of 4.875% and face value of $1,000 makes semi-annual coupon payments.

  The annualized spot rates with continuous compounding are

you have entered into a currency swap in which you receive 4pa in yen and pay 6pa in dollars once a year. the

  What amount of gain or loss does ron realize on the form

Ron and Hermione formed Wizard Corporation on January 2.  Ron contributed cash of $200,000 in return for 50 percent of the corporation’s stock.  Hermione contributed a building and land with the following fair market values and tax-adjusted bases in ..

  Pharmaceutical company and considering

You are the manager of a pharmaceutical company and considering what type of laptop computers to buy for your salespeople.a. You can buy old machines for $2,000 each. These machines will be obsolete (no value) in three years and are expected to have ..

  Maximize profit potential a hostile takeover

When managers fail to maximize profit potential a hostile takeover could occur.

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