The required rate of return in the market

Assignment Help Financial Management

Reference no: EM13911067

Assume that you are the portfolio manager of the Maryland Fund, a $6 million mutual fund that contains the following stocks:

Stock Amount Beta

A $2,500,000 0.90

B $1,750,000 1.05

C $1,000,000 1.25

D $750,000 1.30

The required rate of return in the market is 12.2% and the risk-free rate is 5.50%. What rate of return should investors expect (and require) on their investment in this fund?

Reference no: EM13911067

Questions Cloud

Do you think that mobile commerce is a significant : The volume of mobile commerce in the United States is expected to reach only about 7 percent of total B2C sales by 2016. Do you think that mobile commerce is a significant capability for shoppers? Why or why not?

What is the present value of a five period annuity : What is the present value of a five period annuity of $1,000 if the interest rate is 10% and the first payment is made today?

Project for the ultimate recreational tennis racket : You are evaluating a project for The Ultimate recreational tennis racket, guaranteed to correct that wimpy backhand. You estimate the sales price of The Ultimate to be $480 per unit and sales volume to be 1,000 units in year 1; 1,250 units in year 2;..

Identify three specific actions an organization : Identify three specific actions an organization can take to overcome consumers lack of trust.

The required rate of return in the market : Assume that you are the portfolio manager of the Maryland Fund, a $6 million mutual fund that contains the following stocks: The required rate of return in the market is 12.2% and the risk-free rate is 5.50%. What rate of return should investors expe..

Piaggio applies overhead to product costs : What account(s) is (are) used to eliminate over applied or under applied overhead from the Factory Overhead account,

What are some strategies used to retarget : What is retargeting? What are some strategies used to retarget Web site visitors?

What is the operating cash flow for the project : You are evaluating a project for The Tiff-any golf club, guaranteed to correct that nasty slice. You estimate the sales price of The Tiff-any to be $440 per unit and sales volume to be 1,000 units in year 1; 1,500 units in year 2; What is the operati..

Concerning the return on stock-compute your expected return : Given the following probability distribution describing your expectations concerning the return on this stock, compute your expected return?

User Account

All Pages