Stock compared to what it should be according to CAPM

Assignment Help Financial Management

Reference no: EM131536551

A stock has a beta of 1.2 and an expected return of 10%. The risk free rate is 3% and the expected return on the market portfolio is 10%. How much better (or worse) is the expected return on the stock compared to what it should be according to the CAPM? Enter answer in percents, accurate to two decimal places.

Reference no: EM131536551

Questions Cloud

Steady-state output per worker ratio : a) What is the steady-state output per worker ratio? b) What is the level of saving at steady state? Please show calculations:

State the value of the stock destroyed by fire : A trader dealing in a standard line of goods which he regularly sold at 25% above cost price, discovered on the morning of 17th March.

Discuss the company nominal ledger in the year ended : At September 30th, 1961, the directors of XY Ltd. created a provision in their accounts against the following debts which they consider to be of doubtful nature

Why did you select the organization : Why did you select the organization? How do you see the organization being a benefit to you in your career of choice?

Stock compared to what it should be according to CAPM : How much better (or worse) is the expected return on the stock compared to what it should be according to the CAPM?

What are the cultural influences on training and development : What are the cultural influences on training and development? Provide two examples. How do internal and external social media influence organizational culture

Evaluate the stock of unused petrol : The following Trial Balance was extracted from the books of Jackson trader, at 31st March, 1961.

What is the portfolio weight on the T-bills : A SPDR is an exchange traded fund (ETF) that is designed to generate the same return as the S&P 500 index. What is the portfolio weight on the T-Bills?

What crime prevention programs or initiatives are available : What crime prevention programs or initiatives are available to potentially address the crime or criminal justice issue?

User Account

All Pages