Draw distinctions between 'Standard Deviation' and 'Beta' as measures of risk.
Suppose you have invested Rs.1,00,000 in the following four stocks:
Stock Amount of Investment

(Rs.)

Beta Variance
A 10,000 1.20 15%
B 40,000 0.95 10%
C 20,000 1.10 12%
D 30,000 1.50 18%
The risk free rate is 6.5% per annum and the expected return on the market portfolio is
12.5%. What is the expected return on your portfolio? What is portfolio systematic risk?

Answer rating: 100% (QA)

Standard deviation and beta are two common measures of risk used in finance Standard deviation is a ... View the full answer