Using Table 5.3 as your guide, what is your estimate of the expected annual HPR on the market index stock portfolio if the current risk-free interest rate is 5.1%? (Round your answer to 2 decimal places.)

Expected Annual HPR % ?

TABLE 5.3 Risk and return of investments in major asset classes, 1927-2016 T-bills T-bonds Stocks Arithmetic average 5.51 3.42 11.91 N/A Risk premium 2.08 8.48 Standard deviation 3.14 8.14 19.99 14.71 38.07 56.38 max -8.47 -43.73 -0.02 min