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What would the investors expected the price of the stock

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You have $200,000 to invest in portfolio contains Ali shares and Lily shares. You wanted to create portfolio which would have a return of 25%. If the stock Ali has expected return of 28% and Lily share has a return of 18%, how much money you would invest in Lily share. Assuming beta for Ali is 0.8 and Lily beta is 1.

Question 1: FGV is currently selling around $40. It beta is currently at 0.8 and its year end dividend is expected to be $1.50. Currently the risk free rate is at 3 percent and the market risk premium is at 8%. What would the investors expected the price of the stock to be one year from now?

Reference no: EM132566455

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