## (Solution Download) Stock J has a beta of 1.22 and an expected return of 13.26 percent, while Stock K has a beta of 0.77

 Stock J has a beta of 1.22 and an expected return of 13.26 percent, while Stock K has a beta of 0.77 and an expected return of 10.2 percent. You want a portfolio with the same risk as the market.

 Requirement 1: What is the portfolio weight of each stock? (Do not round intermediate calculations. Round your answers to 4 decimal places (e.g., 32.1616).)

 Stock J Stock K

 Requirement 2: What is the expected return of your portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

 Expected return of the portfolio %

 You have a portfolio with the following:

 Stock Number of Shares Price Expected Return W 875 \$ 52 14% X 775 29 18 Y 525 65 16 Z 750 50 17

 Required: What is the expected return of your portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

 Expected return of the portfolio %

 You want to create a portfolio equally as risky as the market, and you have \$500,000 to invest. Information about the possible investments is given below:

 Asset Investment Beta Stock A \$ 133,000 .78 Stock B \$ 147,000 1.23 Stock C 1.38 Risk-free asset

 Requirement 1:

 How much will you invest in Stock C? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

 Investment in Stock C \$

 Requirement 2: How much will you invest in the risk-free asset? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

 Investment in risk-free asset \$

Solution details:
STATUS
QUALITY
Approved

This question was answered on: Dec 08, 2020

Solution~000652147653948.zip (25.37 KB)

This attachment is locked

We have a ready expert answer for this paper which you can use for in-depth understanding, research editing or paraphrasing. You can buy it or order for a fresh, original and plagiarism-free solution (Deadline assured. Flexible pricing. TurnItIn Report provided)

STATUS

QUALITY

Approved

Dec 08, 2020

EXPERT

Tutor