Consider the following data for CGB Inc.: Risk- Market COV (I, Rate m) Free rate 2%...
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Consider the following data for CGB Inc.: Risk- Market COV (I, Rate m) Free rate 2% 10% 0.046816 CORR (I, Std. dev. Std. Market m) dev. Stock 19% 0.77 32% Assuming the stock returns 9%, calculate the alpha for CGB Inc., and state whether or not you'd recommend this investment to a portfolio manager (justify your answer). Consider the following data for CGB Inc.: Risk- Market COV (I, Rate m) Free rate 2% 10% 0.046816 CORR (I, Std. dev. Std. Market m) dev. Stock 19% 0.77 32% Assuming the stock returns 9%, calculate the alpha for CGB Inc., and state whether or not you'd recommend this investment to a portfolio manager (justify your answer).
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To calculate the alpha for CGB Inc we need to use the Capital Asset Pricing Model CAPM formula Alpha ... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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