Diversified portfolio that has an expected return

Assignment Help Financial Management
Reference no: EM131307879

Ivan Knobel holds a well-diversified portfolio that has an expected return of 11.0% and a beta of 1.20. He is in the process of buying 1,000 shares of Syngine Corp at $20 a share and adding it to his portfolio. Syngine has an expected return of 13.0% and a beta of 1.50. The total value of Ivan’s current portfolio is $80,000. What will the expected return and beta on the portfolio be after the purchase of the Syngine stock?

Reference no: EM131307879

Questions Cloud

Calculate the next payment each party makes : Consider a currency swap for $10 million and SF 15 million. One party pays dollars at a fixed rate of 9% and the other pays Swiss francs at a fixed rate of 8%. The payments are made semiannually based on the exact day count and 360 days in a year. Th..
Create hardship for taxpayers in certain situations : In regard to Section 121, Sale of a Residence, the two-year ownership and use requirement and the "only once every two years" provision could create a hardship for taxpayers in certain situations that are beyond their control. The IRS allows three ex..
Analyzing potental project which will require an initial : An all equity firm is analyzing a potental project which will require an initial, after tax cash put lay of 50000 and after tax acash inflows of 6000 per year for 10 years. In addition, this project will have an after tax salvage value of 10000 at th..
Discuss issues in executive compensation : Discuss issues in Executive compensation (why are they paid more - what is the justification, what are some of the morale issues surrounding exec compensation among employees, what's really fair in terms of exec comp, how can exec comp packages be co..
Diversified portfolio that has an expected return : Ivan Knobel holds a well-diversified portfolio that has an expected return of 11.0% and a beta of 1.20. He is in the process of buying 1,000 shares of Syngine Corp at $20 a share and adding it to his portfolio. Syngine has an expected return of 13.0%..
Dividends are anticipated to maintain growth rate : The next dividend payment by Wyatt, Inc., will be $2.65 per share. The dividends are anticipated to maintain a growth rate of 6.50 percent, forever. If the stock currently sells for $48.90 per share, what is the required return?
Known as rate of return and discount rate : Your finance professor Dr. Awesome makes you the following offer: She will give you $3,000 at the end of each year for the next SIX years if you agree to pay her back $2,500 at the end of each of the following ten years. Should you accept this offer ..
Compound interest with nonannual periods : (Compound interest with nonannual periods?) Calculate the future sum of ?$4,000 ?, given that it will be held in the bank 8 years at an annual interest rate of 4 percent. Recalculate part? (a) using compounding periods that are? (1) semiannual and? (..
What is accumulated sum of each of the streams of? payments : (Compound annuity?) What is the accumulated sum of each of the following streams of? payments?

Reviews

Write a Review

Financial Management Questions & Answers

  What is the amount of the depreciation expense

Suppose you are given the following information for Yusuf Surfing Co.: Sales = $40,000; costs of goods sold = $15,000; addition to retained earnings = $5,221; dividends paid = $1,469; interest expense = $1,300; tax rate = 40% . What is the amount of ..

  Budget actual current monthly salary before tax

Budget profile for a medical Resident monthly Budget Actual Current Monthly salary before tax $5,000 Retirement deduction before taxes $350 pretax contribution $300 Housing $900 utilities $70 $65 Food $700 $500 Gas $125 $100 Car payment $400 cell pho..

  How is intrinsic value estimated in business valuation

What is the intrinsic value? Why is it so important? How is it estimated in business valuation? What is WACC? Why is it so important in business valuation?

  How much will that increase her annual savings

Angela analyzes her personal budget and decides that she can reduce her recreational spending by $50 per month. How much will that increase her annual savings? What will her annual savings be now?

  Which article of labor law would you use to file this claim

An employee filed a lawsuit against his previous employer claiming his former employer has not paid his overtime allowance for extra work that he was asked to work. Under which Article of the Labor Law would you use to file this claim? As the employe..

  Rapid-growth it firm

TechNo Corp is a rapid-growth IT firm. TechNo expects to grow at 25% for the next four years. After year four, growth will moderate at 4.75% and TechNo will pay a dividend of $3.25 per share in year five. If TechNo’s required return is 13.2% and the ..

  Statement of cash flows assuming that direct method is used

Spencer Corp. reported accounts receivable of $28,000 on its December 31, 2013, balance sheet. On December 31, 2014, accounts receivable had decreased to $15,500. Sales for the year amounted to $60,500. What is the amount of cash collections that Spe..

  A price to book ratio considers

A price to book ratio considers

  Weighted average cost of capital based on market values

FINM321 PROJECT 2016 - Calculate the cost of debt and calculate the weighted average cost of capital based on market values. Only include equity and long term debt in your calculation.

  What is the new price of the bond using duration

You find a bond with 25 years until maturity that has a coupon rate of 10.0 percent and a yield to maturity of 8.5 percent. Suppose the yield to maturity on the bond increases by .25 percent. What is the new price of the bond using duration?

  Debt-assets ratio-sales and costs remained constant

Last year Rennie Industries had sales of $305,000, assets of $175,000, a profit margin of 5.3%, and an equity multiplier of 1.2. The CFO believes that the company could reduce its assets by $51,000 without affecting either sales or costs. Had it redu..

  Firm is evaluating project-what is the profitability index

A firm is evaluating a project which will cost $10,269 today and provide cash flows in years 1, 2, and 3 of $7,560, $3,286, $3,268 and, respectively. The firm’s discount rate is 8%. What is the profitability index?

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