Question: Calculate expected alpha values for Stocks A and B. A portfolio manager summarizes the input from the macro and micro forecasts in the following table:

summarizes the input from the macro and micro forecasts in the following Calculate expected alpha values for Stocks A and B.

A portfolio manager summarizes the input from the macro and micro forecasts in the following table: Micro Forecasts Asset Expected Return (%) Beta Residual Standard Deviation (%) Stock A 20 1.50 60 Stock B 18 2.00 40 Macro Forecasts Asset Expected Return (%) Standard Deviation (%) T-bills 5 0 Passive Equity Portfolio (m) 16 25 Calculate expected alpha values for stock A. A portfolio manager summarizes the input from the macro and micro forecasts in the following table: Micro Forecasts Asset Expected Return (%) Beta Residual Standard Deviation (%) Stock A 20 1.50 60 Stock B 18 2.00 40 Macro Forecasts Asset Expected Return (%) Standard Deviation (%) T-bills 5 0 Passive Equity Portfolio (m) 16 25 Calculate expected alpha values for stock B

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