What is the portfolio beta

Assignment Help Financial Management
Reference no: EM131078239

You own a stock portfolio invested 34 percent in Stock Q, 18 percent in Stock R, 36 percent in Stock S, and 12 percent in Stock T. The betas for these four stocks are 1.03, 1.09, 1.49, and 1.94, respectively. Required: What is the portfolio beta?

Reference no: EM131078239

Questions Cloud

Capital budgeting criteria-ethical considerations : A mining company is considering a new project. Because the mine has received a permit, the project would be legal; but it would cause significant harm to a nearby river. The firm could spend an additional $10 million at Year 0 to mitigate the environ..
Pension plan is obligated to make disbursements : A pension plan is obligated to make disbursements of $2.7 million, $3.7 million, and $2.7 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations if the interest rate is 10% annually.
Cost of the party as an entertainment expense : Evander, an officer in the Marine Corps, was appointed commanding officer of the Marine training base in Beaufort, S.C. As is customary in connection with changes in command, he hosts a party at his home for officers and guests the night before he as..
What was dividend yield and the capital gains yield : Suppose a stock had an initial price of $80 per share, paid a dividend of $0.60 per share during the year, and had an ending share price of $88. What was the dividend yield and the capital gains yield?
What is the portfolio beta : You own a stock portfolio invested 34 percent in Stock Q, 18 percent in Stock R, 36 percent in Stock S, and 12 percent in Stock T. The betas for these four stocks are 1.03, 1.09, 1.49, and 1.94, respectively. Required: What is the portfolio beta?
Describe the different types of leases : Describe the different types of leases. Explain how they would benefit managers for financial planning. Select one lease option and describe the advantages and disadvantages of selecting that option in your role as manager. In response to your peers,..
What must the risk-free rate be : A stock has an expected return of 15 percent, its beta is 1.35, and the expected return on the market is 13 percent. What must the risk-free rate be? (Do not round your intermediate calculations.)
What is maximum price you would pay for sunblocker stock : You are considering acquiring SunBlocker Oil common stock that you would like to hold for one year. You expect to receive both $2.50 in dividends and $37 from the sale of the stock at the end of the year. You require a minimum rate of return of 15%. ..
Management strategies in the fundamental analysis category : Which of the active management strategies in the fundamental analysis category is most suitable for structuring an investment portfolio? Selecting individual stocks to buy or sell?

Reviews

Write a Review

Financial Management Questions & Answers

  The finance charges for a loan may include

The finance charges for a loan may include

  About the current liabilities

Which of the following are included in current liabilities?

  Describe an optimal inventory policy

The Treknotrics store begins each week with 300 phasers in stock. This stock is depleted each week and reordered. If the carrying cost per phasers is $38 per year and the fixed order cost is $75, what is the total carrying? What is the restocking cos..

  What is the coupon rate on the bond

Is the yield to maturity on a bond the same thing as the required return? Is YTM the same thing as the coupon rate? Suppose today a 10 percent coupon bond sells at par. Two years from now, the required return on the same bond is 8 percent. What is th..

  The return on equity for similar stocks

A stock has just paid a dividend and has declared an annual dividend of $2.00 to be paid one year from today. The dividend is expected to grow at a 5% annual rate. The return on equity for similar stocks is 12%. What is P0?

  What is expected return on portfolio-is equally invested

What is the expected return on a portfolio that is equally invested in the two assets? If a portfolio of the two assets has an expected return of 12.3 percent, what is its beta?  If a portfolio of the two assets has a beta of 2.53, what are the portf..

  What is the projects net cash flow

Down Under Boomerang, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $1.4 million. The fixed asset falls into the three-year MACRS class. The tax rate is 35 percent and the required return i..

  Difference between sensitivity analysis-scenario analysis

Explain the difference between sensitivity analysis and scenario analysis. Offer and argument for the proposition that scenario analysis offers a more realistic picture of a project’s risk than does sensitivity analysis

  Asymmetric information have on the optimal level of leverage

What impact does asymmetric information have on the optimal level of leverage? In your answer, be sure to describe the implications of adverse selection and the lemons principle for equity issuance, as well as the empirical implications.

  What is the discounted payback period for cash flows

An investment project has annual cash inflows of $4,500, $3,800, $5,000, and $4,200, for the next four years, respectively. The discount rate is 15 percent. What is the discounted payback period for these cash flows if the initial cost is $5,600?

  Present value of a perpetuity

Present value of a perpetuity. What is the present value of a $400 perpetuity if the interest rate is 6%? Round your answer to the nearest cent.

  What are the effects on the after-tax profits and cash flow

A project currently generates sales of $11.4 million, variable costs equal to 50% of sales, and fixed costs of $3.4 million. The firm’s tax rate is 30%. a. What are the effects on the after-tax profits and cash flow, if sales increase from $11.4 mill..

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