Stock investment using the capital asset pricing model

Assignment Help Financial Management

Reference no: EM132068728

A stock has an historical average return of 9.8%, and standard deviation of 8.8%. The market is expected to earn a 9.7% rate of return, and has a standard deviation of 5.9%. The stock's beta coefficient is 1.35, and the risk free rate of return is 3.5%. What is the required return for this stock investment using the capital asset pricing model?

Reference no: EM132068728

Questions Cloud

What market price will the bond sell : The required return for investing in this bond is 4.0%. At what market price will the bond sell if the interest is paid semi-annually?

What is the equivalent annualized rate of return : What is the net present value of the project? A stock earns a monthly return of 0.85%. What is the equivalent annualized rate of return?

Why would the us treasury issue such security : Why would investors be interested in TIPS. Why would the US Treasury issue such a security?

Both the interest and principal of the loan were paid : Both the interest and principal of the loan were paid on December 31, 20X1. The publishing firm's tax rate is 30 percent.

Stock investment using the capital asset pricing model : What is the required return for this stock investment using the capital asset pricing model?

Famous failures in finance : Famous Failures in Finance: Shady Trading at Enron Before it was known for its financial problems, what actions should have been taken by auditors, regulators.

Determine the effective-interest rate : Determine the effective-interest rate.

Selling their products in overseas domestic markets : A firm that expands internationally by selling their products in overseas domestic markets is

Create similar competitiveness and alignment diagrams : Create similar Competitiveness and Alignment Diagrams for Microsoft.

User Account

All Pages