Calculate the treynor index for these five stocks

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Wal-Mart Stores, Inc. (WMT) beta = .40, expected return = 9.8% Use an expected return on the market of 12% and a risk-free rate of 3% for your calculations. Acxiom Corporation (ACXM) beta = 1.39, expected return = 16.9% Tyson Foods, Inc. (TSN) beta = .43, expected return = 11.2% JB Hunt Transport Services, Inc. (JBHT) beta = 1.00, expected return = 12.6% Home Bancshares, Inc. (HOMB) beta = .75, expected return = 8.7% Use an expected return on the market of 12% and a risk-free rate of 3% for your calculations.

1. Calculate the Treynor Index for these five stocks.

2. Rank the stocks from best to worst based on the Treynor Index.

3. What would happen to the prices of these stocks if markets were efficient?

Reference no: EM132342118

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