Betas and risk rankings Personal Finance Problem You are considering three stocks -A, B, and C-for possible inclusion in your investment portfolio. Stock A has a beta of 1.2, stock B has a beta of 1.5, and stock C has a beta of -0.2. a. Rank these stocks from the most risky to the least risky. b. If you believed that the stock market was getting ready to experience a significant decline, which stock should you add to your portfolio? c. If you anticipated a major stock market rally, which stock would you add to your portfolio? a. Which stock is the most risky one? (Select the best answer below.) O A. Stock A O B. Stock B O C. Stock C Which stock is the least risky one? (Select the best answer below.) O A. Stock B O B. Stock A O C. Stock C b. If you felt that the stock market was getting ready to experience a significant decline, which stock should you add to your portfolio? (Select the best answer below.) b. If you felt that the stock market was getting ready to experience a significant decline, which stock should you add to your portfolio? (Select the best answer below.) O A. Stock C O B. Stock B OC. Stock A c. If you anticipated a major stock market rally, which stock would you add to your portfolio? (Select the best answer below.) O A. Stock C O B. Stock A O c. Stock B
Betas and risk rankings Personal Finance Problem You are considering three stocks -A, B, and C-for possible inclusion in your investment portfolio. Stock A has a beta of 1.2, stock B has a beta of 1.5, and stock C has a beta of -0.2. a. Rank these stocks from the most risky to the least risky. b. If you believed that the stock market was getting ready to experience a significant decline, which stock should you add to your portfolio? c. If you anticipated a major stock market rally, which stock would you add to your portfolio? a. Which stock is the most risky one? (Select the best answer below.) O A. Stock A O B. Stock B O C. Stock C Which stock is the least risky one? (Select the best answer below.) O A. Stock B O B. Stock A O C. Stock C b. If you felt that the stock market was getting ready to experience a significant decline, which stock should you add to your portfolio? (Select the best answer below.) b. If you felt that the stock market was getting ready to experience a significant decline, which stock should you add to your portfolio? (Select the best answer below.) O A. Stock C O B. Stock B OC. Stock A c. If you anticipated a major stock market rally, which stock would you add to your portfolio? (Select the best answer below.) O A. Stock C O B. Stock A O c. Stock B
Chapter14: Investing In Stocks And Bonds
Section: Chapter Questions
Problem 8DTM
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