The expected return of zero beta security is risk free rate

Assignment Help Financial Management

Reference no: EM132018594

Please comment the following statement

1) The expected return of zero beta security is risk free rate;

2) According to CAPM, the higher the standard deviation, the higher the expected return.

3) As diversification increases, the firm-specific risk of a portfolio approaches 1.

4) Analysts may use regression analysis to estimate the index model for a stock. When doing so, the slope of the regression line is an estimate of the volatility of the asset.

Reference no: EM132018594

Questions Cloud

Some of key weaknesses of ratios such as price-to-earnings : What are some of the key weaknesses of ratios such as price-to-earnings, price-to-sales, and price-to-book value?

Determine the company overhead rate : The company allocates manufacturing overhead on the basis of machine hours. Determine the company overhead rate

Describe the characteristics of jazz dance : Describe the characteristics of Jazz dance. What is your definition of "style"? Also, do you think that having "style" is important to a jazz dancer?

Describe the structure and genetic properties of dna : Outline the DNA typing techniques. Identify the methods used to test DNA. Describe the collection process of DNA evidence.

The expected return of zero beta security is risk free rate : The expected return of zero beta security is risk free rate; As diversification increases, the firm-specific risk of a portfolio approaches 1.

What is the project after-tax present value : what is the project's after-tax present value? you may assume a zero gross income.

Describe the biological evidence obtained at the crime scene : Describe the biological evidence obtained at the crime scene. Identify the preservation and collection of the various types of biological evidence.

Discuss which dance production job best describes you : What personal characteristics do you think are necessary for an artistic director to have? Why? Discuss which dance production "job" best describes you?

What is the expected value and standard deviation : What is the expected value and standard deviation of the rate of return on your client's optimized portfolio?

User Account

All Pages