What will be the expected return and the beta of your portfolio after you purchase the new stock
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- You are an investor in common stock, and you currently hold a well-diversified portfolio which has an expected return of 12 percent, a beta of 1.2, and a total value of $9,000. You plan to increase your portfolio by buying 100 shares of AT&E at $10 a share. AT&E has an expected return of 20 percent with a beta of 2.0. What will be the expected return and the beta of your portfolio after you purchase the new stock?
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- You have $100,000 to invest in a portfolio containing Stock X and Stock Y. Your goal is to create a portfolio that has an expected return of 24% .Suppose Stock X has an expected return of 18% and beta of 1.4, and Stock Y has an expected return of 12% and beta of 0.8 %. 1. How much money will you invest in Stock Y? 2. What is the beta of your portfolio?You have $122,000 to invest in a portfolio containing Stock X and Stock Y. Your goal is to create a portfolio that has an expected return of 17.6 percent. Stock X has an expected return of 14.0 percent and a beta of 1.26, and Stock Y has an expected return of 9.5 percent and a beta of 1.00. a. How much money will you invest in Stock Y? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) b. What is the beta of your portfolio?Suppose you hold a diversified portfolio consisting of a $7,500 investment in each of 20 different common stocks. The portfolio beta is equal to 1.12. Now, suppose you have decide to sell one of the stocks in your portfolio with a beta equal to 1.0 for 7,500 and to use these proceeds to buy another stocks for your portfolio. Assume the new stocks beta to 1.75. Calculate your portfolios new beta.
- Suppose you hold a diversified portfolio consisting of a $4,000 investment in each of 14 different common stocks. The portfolio beta is 1.30. You decide to sell one of the stocks in your portfolio with a beta equal to 0.8 for $3,500 and use these proceed to buy another stock for your portfolio. Assume the new stock’s beta is equal to 1.75. Calculate your portfolio’s beta.Suppose you hold a diversified portfolio consisting of a $7,500 investment in eachof 20 different common stocks. The portfolio beta is equal to 1.12. Now, supposeyou have decided to sell one of the stocks in your portfolio with a beta equal to 1.0for $7,500 and to use these proceeds to buy another stock for your portfolio.Assume the new stock’s beta is equal to 1.75. Calculate your portfolio’s new beta.You hold a diversified portfolio consisting of a $10,000 investment in each of 20 different common stocks (that is, your total investment is $200,000). The portfolio beta is equal to 1.2. You have decided to sell one of your stocks that has a beta equal to 0.7 for $10,000. You plan to use the proceeds to purchase another stock that has a beta equal to 1.4. What will be the beta of the new portfolio?
- You have $150,000 to invest in a portfolio containing Stock X and Stock Y. Your goal is to create a portfolio that has an expected return of 14.1 percent. Stock X has an expected return of 12.93 percent and a beta of 1.42 and Stock Y has an expected return of 8.51 percent and a beta of .74. I found the Beta of portfolio to be 1.60 and that is correct I need to find how much I invest in Stock Y. I come up with an answer of -$39,616.25. And yet that answer seems to be incorret. All solutions and equations point to that as the solution. Need some help please.Assume that you hold a well-diversified portfolio that has an expected return of 11.0% and a beta of 1.20. You are in the process of buying 1,000 shares of Alpha Corp at $10 a share and adding it to your portfolio. Alpha has an expected return of 21.5% and a beta of 1.70. The total value of your current portfolio is $90,000. What will the expected return and beta on the portfolio be after the purchase of the Alpha stock? Do not round your intermediate calculations.Suppose that one year ago, you invested in a stock market portfolio, which is currently worth £62,000. You are convinced the portfolio is well-diversified and fitted to your profile as an investor, and the beta of your portfolic is 0.9. You are planning to hold this portfolio for at least another three years. Suppose that the current level of FTSE100 is 1850, and the risk - free interest rate is 1.5% a) Iderdify any relevant risk that you may be facing in reference to your investment portfolio. b) Suppose there is a two year FTSE100 futures contract available. The futures price is 1855, and one contract is for £10 times the index: How many contracts would you need to eliminate the exposure to the market over the next two years? What position in these contracts would you take today? c) Evaluate the out comes of your hedging strategy if FTSE100 in two years'time is 1842. Comment on your results.
- You are thinking of buying a stock priced at $100 per share. Assume that the risk-free rate is about 4.5% and the market risk premium is 6%. If you think the stock will rise to $117 per share by the end of the year, at which time it will pay a $1 dividend, what beta would it need to have for this expectation to be consistent with the CAPM?You have just invested in a portfolio of three stocks. The amount of money that you invested in each stock and its net are summarized below. Calculate the beta of the portfolio and use the capital asset pricing model (CAPM) to compute the expected rate of return for the portfolio. Assume that the expected rate of return on the market is 18% and that the risk-free rate is 6%. Stock A, Investment = $188,000, Beta=1.50, Stock B, Investment = $282,000, Beta =0.50, Stock C, Investment = $470,000, Beta = 1.30 Beta of the portfolio ? Expected rat of return ? %You have a $5 million portfolio consisting of a $250,000 investment in each of 20 different stocks. The portfolio has a beta of 1.2. You are considering selling $500,000 worth of one stock with a beta of 0.8 and using the proceeds to purchase another stock with a beta of 1.6. What will the portfolio’s new beta be after these transactions? Im stuck
