What is the portfolio beta

Assignment Help Financial Management
Reference no: EM13911130

You own a stock portfolio invested 25 percent in Stock Q, 25 percent in Stock R, 20 percent in Stock S, and 30 percent in Stock T. The betas for these four stocks are 1.7, .6, 1.8, and .9, respectively. What is the portfolio beta? (Do not round intermediate calculations. Round your answer to 3 decimal places.)

Reference no: EM13911130

Questions Cloud

What is the value of their shares of stock : Paradise Adventures just paid a dividend of $2.00. They are growing rapidly and are expecting to grow dividends at 20% for the next two years and then 10% in the third year before reducing the dividends to a constant growth rate of 3%. If the require..
Using the corporate valuation model : Assume today is December 31, 2013. Barrington Industries expects that its 2014 after-tax operating income [EBIT(1 – T)] will be $400 million and its 2014 depreciation expense will be $70 million. Using the corporate valuation model, what should be th..
Discuss the benefits and potential risks of sharing product : Discuss the benefits and potential risks of sharing product data with external users through use of a PLM system.
What is the effect of compound interest : If you invest $700 today in an account that pays 6.5 percent compounded semi-annually, how much will be in your account after eight years? What is the effect of compound interest? Please show your work.
What is the portfolio beta : You own a stock portfolio invested 25 percent in Stock Q, 25 percent in Stock R, 20 percent in Stock S, and 30 percent in Stock T. The betas for these four stocks are 1.7, .6, 1.8, and .9, respectively. What is the portfolio beta?
Provide an example for which the use of a batch processing : Provide an example for which the use of a batch processing system to handle transactions is appropriate. Provide an example for which the use of online transaction processing is appropriate.
Determine weights of each source of capital in structure : Ngala LLC has 5,000 bonds outstanding which are currently priced at $1,200 each. The bonds pay a coupon of 7.6% (paid semi annually) and mature in 7 years. The bonds have a face value of $1,000 each.  Determine (a) the weights of each source of capit..
What is the investors required return : ATP Industries paid a $0.50 dividend to its common shareholders 6 years ago. It just paid a dividend of $0.67 to its common shareholders. If dividends continue to grow at this rate for the foreseeable future, and the shares are worth $10.05, what is ..
What is the terminal or horizon value : Maverick Milling Co. just paid a dividend of $1.00 to its shareholders. The firm is expecting high growth over the next few years and is projecting the dividend to grow by 15% in the first year, 20% in the second year, and $15% in the third year, bef..

Reviews

Write a Review

Financial Management Questions & Answers

  What is its after-tax cost of debt

Micro Spinoffs, Inc., issued 20-year debt a year ago at par value with a coupon rate of 5%, paid annually. Today, the debt is selling at $1,120. If the firm’s tax bracket is 30%, what is its after-tax cost of debt? (Do not round intermediate calculat..

  The risk-free rate and beta remain unchanged

Yonan Corporation's stock had a required return of 11.5% last year, when the risk-free rate was 5.5% and the market risk premium was 4.75%. Now suppose there is a shift in investor risk aversion, and the market risk premium increases by 2%. The risk-..

  Calculate the sustainable growth rate

PING, INC. projects a rate of return on equity of 20%. Management plans to pay 70% of earnings as dividends. Earnings this year will be $3 per share, and investors expect a 12 rate of return on the stock. Calculate the sustainable growth rate.

  Contribution to your individual retirement account

You have just made your first $4,500 contribution to your individual retirement account. Assume you earn a 11.30 percent rate of return and make no additional contributions. What will your account be worth when you retire in 39 years? What if you wai..

  A project will produce an operating cash flow

A project will produce an operating cash flow of $14,600 a year for 7 years. The initial fixed asset investment in the project will be $48,900. The net after tax salvage value is estimated at $12,000 and will be received during the last year of the p..

  Compute the price of an american call option

Compute the price of an American call option with strike K=110 and maturity T=.25 years. If your answer to Question 3 is "Yes", when is the earliest period at which it might be optimal to early exercise? (If your answer to Question 3 is "No", then yo..

  1 provide the four selected investment categories for the

1. provide the four selected investment categories for the clients portfolio and the associated percentage allocations

  What is the effective interest rate

What is the effective interest rate of 10 percent compounded quarterly, versus 10 percent compounded monthly?

  Hedging strategies

Hedging strategies are

  Bonds are callable in five years at a price

Bonds mature in 13 years. The bonds have a face value of $1,000 and an 9% coupon rate, paid semi-annually. The price of the bonds is $1,150. Bonds are callable in five years at a price of $1,050. Need YTM and YTC

  Degree of financial leverage and degree of total leverage

Use the financial information given in the following table to compute the firm’s (a) degree of operating leverage (DOL), (b) degree of financial leverage (DFL), and (c) degree of total leverage (DTL). The firm has no preferred stock.

  Calculate expected rates of return for market and stock

The market and stock J have the following probability distributions: Calculate the expected rates of return for the market and stock J.

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