Problem 2 (15 Marks) You have a portfolio made up of the following holdings: 5,000 shares of Goodman Ltd, 2,800 shares of Wexler Ltd. and $1,000 shares of Nacho Ltd. Based on the information at the back of the exam: a Calculate the expected annual return on your portfolio. (6 Marks) Goodman Wexler Nacho 5,000 2,800 1,000 Portfolio Beta = Required return on portfolio b. Calculate whether each stock's actual expected return is: (1) above, (2) below or (3) on the Security Market Line (SML). (9 Marks) Required returns Goodman Wexler Nacho Problem 2 (15 Marks) You have a portfolio made up of the following holdings: 5,000 shares of Goodman Ltd, 2,800 shares of Wexler Ltd. and $1,000 shares of Nacho Ltd. Based on the information at the back of the exam: a Calculate the expected annual return on your portfolio. (6 Marks) Goodman Wexler Nacho 5,000 2,800 1,000 Portfolio Beta = Required return on portfolio b. Calculate whether each stock's actual expected return is: (1) above, (2) below or (3) on the Security Market Line (SML). (9 Marks) Required returns Goodman Wexler Nacho