Question: Consider a stock with a negative beta, specifically beta = -0.08. a-1. How would you expect this stock's rate of return to change if the

 Consider a stock with a negative beta, specifically beta = -0.08.

Consider a stock with a negative beta, specifically beta = -0.08. a-1. How would you expect this stock's rate of return to change if the overall market rose by an extra 10%? negative answer should be indicated by a minus sign. Input your answer as a percent rounded to 2 decimal places.) Change in stock's rate of return % a-2. How would the stock's rate of return change if the overall market fell by an extra -10%? (A negative answer should be indicated by a minus sign. Input your answer as a percent rounded to 2 decimal places.) Change in stock's rate of return % b. You have $1.1 million invested in a well-diversified portfolio of stocks. Now you receive an additional $37,000 bequest. Which of the following actions will yield the safest overall portfolio return? Invest $37000 in Treasury bills, B = 0. Invest $37000 in stocks with B = 1. Invest $37000 in the stock with B = -0.08

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!