Calculate the required rate of return for each stock

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Reference no: EM131354292

The manager of Alpha Beta Funds is considering addition of the following stocks in his portfolio:

Stocks Standard Deviation Covariance Expected (Ri)

A 18% 0.012 20%

B 15% 0.0075 12%

C 10% 0.011 14%

D 20% 0.0175 16%

E 14% 0.016 15%

RM 10% 1.0 14%

RF 0 0.9 6%

A) Calculate the required rate of return for each stock.

B) Assume you are assistant to a portfolio manager, which stocks you recommend to be included in his portfolio?

Reference no: EM131354292

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