CQ

Suppose you estimate that the correlation between Abercrombie and Fitch (ANF) stock returns with market portfolio returns is 0.85.  You also estimate that ANF's stock return's are twice as variable (σANFσM=2.0).   Therefore, what is the the beta for ANF stock (βANF) ?

There are few, if any, real companies with negative betas. But suppose you found one with β = −0.13. a-1. How would you expect this stock's rate of return to change if the overall market rose by an extra 5%? Note: A negative answer should be indicated by a minus sign. Input your answer as a percent rounded to 2 decimal places. a-2. How would the stock's rate of return change if the overall market fell by an extra −5%? Note: A negative answer should be indicated by a minus sign. Input your answer as a percent rounded to 2 decimal places. b. You have $1.1 million invested in a well-diversified portfolio of stocks. Now you receive an additional $32,000 bequest. Which of the following actions will yield the safest overall portfolio return?

Hi I also need help with this one as well 1. A stock has a beta of 1.25, the expected return on the market is 14 percent, and the risk-free rate is 5.2 percent. What must the expected return on this stock be?   2. A stock has an expected return of 13 percent, the risk-free rate is 4.5 percent, and the market risk premium is 7 percent. What must the beta of this stock be? 3. A stock has an expected return of 10 percent, its beta is .70, and the risk-free rate is 5.5 percent. What must the expected return on the market be? 4. A stock has an expected return of 15 percent, its beta is 1.45, and the expected return on the market is 12 percent. What must be risk-free rate be?

Hello! I have a problem with this exercise, i don't know how to solve it. Can you help me, pretty please? Thanks a lot!

Assume that you run a regression on the raw returns of the stock of Company J against the raw returns of the market and find an intercept of 1.324 percent and a beta of 2.36. If the risk-free rate is 2.64 percent, and using the concept of Jensen's Alpha, then determine by how much this stock beat the market. Answer in decimal format. For example, if you answer is 3.33%, enter "0.0333"

6) Can i get help with that question ?

Assume that you run a regression on the raw returns of the stock of Company J against the raw returns of the market and find an intercept of 1.324 percent and a beta of 1.25. If the risk-free rate is 2.64 percent, and using the concept of Jensen's Alpha, then determine by how much this stock beat the market. Answer in decimal format, to 4 decimal places. For example, if you answer is 3.33%, enter "0.0333".

Stock Y has a beta of 1.2. An expected return of 11.4%. Stock Z has a beta of .8 and an expected return of 8%. If the risk free rate is 2.5% and the market risk premium is 7%, are these stocks priced correctly? If not, what should the correct prices be? pls type in computer. Thanks

Consider the two stocks below. Which has a positive beta (i.e., tends to move in the same direction as the market)? Which has a higher R2 (1.e., market returns explain more of its return patterns)? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. Stock 1 has a positive beta and a higher R² a b C d Stock 2 has a positive beta and a higher R² Stock 1 has a positive beta, but Stock 2 has a higher R Stock 2 has a positive beta, but Stock 1 has a higher R² ft RM Stock 2 Stock 1 Par

(Expected rate of return and risk) Syntex, Inc. is considering an investment in one of two common stocks. Given the information that follows, which investment is better, based on the risk (as measured by the standard deviation) and return? Common Stock A Probability 0.20 0.60 0.20 Probability 0.15 0.35 0.35 0.15 (Click on the icon in order to copy its contents into a spreadsheet.) Common Stock B Return 13% 14% 18% Return - 6% 7% 15% 21% a. Given the information in the table, the expected rate of return for stock A is 14.6 %. (Round to two decimal places.) The standard deviation of stock A is %. (Round to two decimal places.)

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A stock has a beta of 1.04, the expected return on the market is 11.75, and the risk-free rate is 3.75. What must the expected return on this stock be? Can the calculator and excel solution be provided?

may i knoow the answer for this question

Did I calculate this correctly?  If not, what am I doing incorrectly? Suppose Intel stock has a beta of 1.72, whereas Boeing stock has a beta of 0.99. If the risk-free interest rate is 3.5% and the expected return of the market portfolio is 12.5%, according to the CAPM, What is the expected return of Intel stock?  Expected return of stock = .1898 = 19%; Expected return of Intel stock is > the market return of 12.5% since Intel Beta is greater than 1 What is the expected return of Boeing stock?  Expected return of stock = .1241 = 12%; Expected return of Boeing stock is < market return of 12.5% since Boeing Beta is less than 1 What is the beta of a portfolio that consists of 65% Intel stock and 35% Boeing stock?  Find the Beta of the portfolio: Beta Portfolio Formula = Weight*Beta + Weight*Beta Beta Portfolio Formula = (.65)(1.72) + (.35)(0.99) 118 + .3465 Portfolio Beta @ 65% Intel and 35% Boeing = 1.4645 = 1.465 4. What is the expected return of a portfolio that consists of…

A stock has a beta of 0.73, the expected return on the market is 0.08, and the risk-free rate is 0.03. What must the expected return on this stock be? Enter the answer with 4 decimals (e.g. 0.1234).

Syntex, Inc. is considering an investment in one of two common stocks.  Given the information that​ follows, which investment is​ better, based on the risk​ (as measured by the standard​ deviation) and​ return?   Common Stock A   Common Stock B     Probability Return Probability Return   0.25 13​% 0.25 −7​%   0.50 14​% 0.25 7​%   0.25 18​% 0.25 16​%       0.25 23​%   ​(Click on the icon    in order to copy its contents into a spreadsheet.​)           Question content area bottom Part 1 a.  Given the information in the​ table, the expected rate of return for stock A is   enter your response here ​%.  ​(Round to two decimal​ places.) Part 2 The standard deviation of stock A is   enter your response here ​%.  ​(Round to two decimal​ places.) Part 3 b.  The expected rate of return for stock B is   enter your response here ​%.  ​(Round to two decimal​ places.) Part 4 The standard deviation for stock B is   enter…

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Syntex, Inc. is considering an investment in one of two common stocks. Given the information that​ follows, which investment is​ better, based on the risk​ (as measured by the standard​ deviation) and​ return?   Common Stock A              Common Stock B              Probability Return Probability Return 0.35 13​% 0.25 −7​%   0.30 17​% 0.25 8​%   0.35 21​% 0.25 15​%       0.25 23​%   ​(Click on the icon    in order to copy its contents into a spreadsheet.​)       Question content area bottom Part 1 a.  Given the information in the​ table, the expected rate of return for stock A is enter your response here​%. ​(Round to two decimal​ places.)

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Which of the following statements is CORRECT? Suppose the returns on two stocks are negatively correlated. One has a beta of 1.2 as determined in a regression analysis using data for the last 5 years, while the other has a beta of −0.6. The returns on the stock with the negative beta must have been negatively correlated with returns on most other stocks during that 5-year period. Suppose you are managing a stock portfolio, and you have information that leads you to believe the stock market is likely to be very strong in the immediate future. That is, you are convinced that the market is about to rise sharply. You should sell your high-beta stocks and buy low-beta stocks in order to take advantage of the expected market move. You think that investor sentiment is about to change, and investors are about to become more risk averse. This suggests that you should re-balance your portfolio to include more high-beta stocks. If the market risk premium remains constant, but the risk-free rate…

Consider the following information for Stocks A, B, and C. The returns on the three stocks, while positively correlated, are not perfectly correlated. The risk-free rate is 5.50%. Stock A B C Expected Return 10.00% 10.90% 11.80% Standard Deviation 15% 15% 15% Beta 1.5 1.8 2.1 Let , be the expected return of stock i, ra represent the risk-free rate, b represent the Beta of a stock, and TM represent the market return. Using SML equation, you can solve for the market risk premium which, in this case, equals approximately The beta for Fund P is approximately Consider Fund P, which has one third of its funds invested in each of stock A, B, and C. You have the market risk premium, the beta for Fund P, and the risk-free rate. Hint: Recall that because the market is in equilibrium, the required rate of return is equal to the expected rate of return for each stock. This information implies that the required rate of return for Fund P is approximately Which of the following is the reason why the…

Provide short answers to the following questions i) The covariance between stock A and market return is 135. The standard deviation of market’s return is15%. What is the beta of stock A?l) Is it true that a market which is efficient in its semi-strong form is automatically efficient in its weakform?

You are conducting some statistical analyses on two securities: Stock X and Stock Y. You find that Stock X has a volatility (i.e., a standard deviation) of 5.78%, while Stock Y has a volatility of 7.94%. If the correlation between the returns of the two firms is 0.25, then what is the covariance between the returns of the two firms closest to? O 0.0011 0.0021 O 11.47 O 21.55 0

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