An fund has a capital of $100M. Its investment opportunity set consists of a risky asset with

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An fund has a capital of $100M. It’s investment opportunity set consists of a risky asset with expected return of 8%, and risk of 16%. The fund wishes to achieve an expected return of 12%. The borrowing rate for the fund is 5% and lending rate is 3%. What allocation by the fund will achieve its target of 12% expected return?

Posted Date: Sep 20, 2021 01:54 AM

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An fund has a capital of $100M. Its investment opportunity set consists of a risky asset with

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Capital for the firm 100000000 Assets 81001000000008000000 Risk 100... View the full answer

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