Solution-Portfolio of the two assets

Portfolio of the two assets

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Reference no: EM131066574

A share has a beta of 1.4 and an expected return of 16%. A risk-free asset currently earns 6.25%.

What is the expected return on a portfolio that is equally invested in the two assets?
If a portfolio of the two assets has a beta of 0.8, what are the portfolio weights?
If a portfolio of the two assets has an expected return of 12%, what is its beta?
If a portfolio of the two assets has a beta of 2.80, what are the portfolio weights?
How do you interpret the weights for the two assets in this case? Explain.

Reference no: EM131066574

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Portfolio of the two assets

Reference no: EM131066574

Reference no: EM131066574

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