Compute the market betas for assets x and y

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Reference no: EM131235330

Consider the following assets:

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(a) Compute the market betas for assets X and Y.

(b) Compute the correlations of assets X and Y with M.

(c) Assume you were holding only M. You now are selling off 10% of your M portfolio to replace it with 10% of either X or Y. Would an MX portfolio or an MY portfolio be riskier?

(d) Is the correlation indicative of which of these two portfolios ended up riskier? Is the market beta indicative?

Reference no: EM131235330

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