3 O 1 52 53 54 65 66 67 An analyst gathered the following information for...
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3 O 1 52 53 54 65 66 67 An analyst gathered the following information for a stock and market parameters: stock beta 1.415; expected return on the Market = 10.23%; expected return on T-bills 4.55%; current stock Price $5.35; expected stock price in one year= $12.12; expected dividend payment next year= $2.56 Calculate the required return and expected return for this stock. a) Required Return: (1.0 points) b) Expected Return: (1.0 points) The market risk premium for next period is 7.82% and the risk-free rate is 3.63%. Stock Z has a beta of 0.829 and an expected return of 14.25%. Compute the following: a) Market's reward-to-risk ratio: (0.75 points) b) Stock Z's reward-to-risk ratio: (0.75 points) An analyst gathered the following information for a stock and market parameters: stock beta 1.480; expected return on the Market - 11.80%; expected return on T-bills 3.40%; current stock Price = $9.81; expected stock price in one year = $14.75; expected dividend payment next year = $2.89. Calculate the a) Required return for this stock (1.25 points): b) Expected return for this stock (1.25 points): The market risk premium for next period is 7.60% and the risk-free rate is 1.60%. Stock Z has a beta of 0.999 and an expected return of 13.50%. What is the: a) Market's reward-to-risk ratio? (1 point); b) Stock Z's reward-to-risk ratio (1 point); You are invested 15.40% in growth stocks with a beta of 1.881, 36.90% in value stocks with a beta of 0.995, and 47.80% in the market portfolio What is the beta of your portfolio? (1 point) 3 O 1 52 53 54 65 66 67 An analyst gathered the following information for a stock and market parameters: stock beta 1.415; expected return on the Market = 10.23%; expected return on T-bills 4.55%; current stock Price $5.35; expected stock price in one year= $12.12; expected dividend payment next year= $2.56 Calculate the required return and expected return for this stock. a) Required Return: (1.0 points) b) Expected Return: (1.0 points) The market risk premium for next period is 7.82% and the risk-free rate is 3.63%. Stock Z has a beta of 0.829 and an expected return of 14.25%. Compute the following: a) Market's reward-to-risk ratio: (0.75 points) b) Stock Z's reward-to-risk ratio: (0.75 points) An analyst gathered the following information for a stock and market parameters: stock beta 1.480; expected return on the Market - 11.80%; expected return on T-bills 3.40%; current stock Price = $9.81; expected stock price in one year = $14.75; expected dividend payment next year = $2.89. Calculate the a) Required return for this stock (1.25 points): b) Expected return for this stock (1.25 points): The market risk premium for next period is 7.60% and the risk-free rate is 1.60%. Stock Z has a beta of 0.999 and an expected return of 13.50%. What is the: a) Market's reward-to-risk ratio? (1 point); b) Stock Z's reward-to-risk ratio (1 point); You are invested 15.40% in growth stocks with a beta of 1.881, 36.90% in value stocks with a beta of 0.995, and 47.80% in the market portfolio What is the beta of your portfolio? (1 point)
Expert Answer:
Answer rating: 100% (QA)
1 Required Return for the stock Risk free rate 455 Market risk premium 1023 455 568 Beta of stock 14... View the full answer
Related Book For
Quantitative Investment Analysis
ISBN: 978-1119104223
3rd edition
Authors: Richard A. DeFusco, Dennis W. McLeavey, Jerald E. Pinto, David E. Runkle
Posted Date:
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