You are an investor in the CAPM world. You only have access to the market portfolio and
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Question:
You are an investor in the CAPM world. You only have access to the market portfolio and the risk-free asset. The Rm is 10% and the prevailing rf is 3%. However, you are targeting a return of 18%. You construct a portfolio to achieve this return target.
What is the weight of the risk free asset? Round your answer to one decimal place. If the weight is 110%, the answer is 1.1.
Related Book For
Intermediate Financial Management
ISBN: 978-1111530266
11th edition
Authors: Eugene F. Brigham, Phillip R. Daves
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