Actual calculations & formulas

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Reference no: EM13847570

IMPORTANT:  ACTUAL CALCULATIONS & FORMULAS IN EXCEL USED REQUIRED

 

PROBLEM

Consider the following three individuals' portfolios consisting of investments in four stocks:

Stock

Beta

John's Investment

Frank's Investment

Bob's Investment

Beta

1.3

2,500

5,000

10,000

Capa

1.0

2,500

5,000

10,000

Zeta

0.8

2,500

5,000

-5,000

Hexo

-0.5

2,500

-5,000

-5,000

Assuming that the risk-free rate is 4% and the expected return on the market is 12%, then calculate the required return on Bob's portfolio.

Reference no: EM13847570

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