Based on the fama-french model calculate the required

Reference no: EM13566382

The estimated factor sensitivities of TerraNova Energy to Fama-French factors and the risk premia associated with those factors are given in the following table:
market factor- factor sensitivity(1.2) risk premium (4.5);
size factor- factor sensitivity(-.5), risk premium(2.7);
value factor- factor sensitivity(-.15), risk premium(4.3).

A. Based on the fama-french model, calculate the required return for terranova energy using these estimates. Assume that the treasury bill rate is 4.7%.

B. Describe the expected style characteristics of terranova based on its factor sensitivities.

Reference no: EM13566382

Questions Cloud

Do you think steinmans recommendation to adjust the : kelly steinman is the manager of a medium size company. a few years ago steinman persuaded the owner to base a part of

You will need to complete a report on a current is topic of : you will need to complete a report on a current is topic of your choice that is raising a lot of buzz or controversy.

Assume you had the following sequence shown below of : assume you had the following sequence shown below of deposits and withdrawals over four years in an account earning 10

Jackie a 25 year old client want to retire by age 65 with : jackie a 25 year old client want to retire by age 65 with 1500000. how much would she have to invest annually

Based on the fama-french model calculate the required : the estimated factor sensitivities of terranova energy to fama-french factors and the risk premia associated with those

What is the fee schedule assuming that these overhead cost : the audiology department at randall clinic offers many services to the clinics patients. the three most common along

Its peer group also has an roe of 231 percent but has : carter inc. a manufacturer of electrical supplies has an roe of 23.1 percent a profit margin of 4.9 percent and a total

Discuss the potential causes of and financial implications : discuss the potential causes of and financial implications of the relationship of short- and long-term interest rate

Larned corporation recorded the following transactions for : larned corporation recorded the following transactions for the just completed month. a. 71500 in raw materials were

User Account

All Pages