What does the beta of the new investment have to be

Assignment Help Financial Management
Reference no: EM131351780

You currently own a portfolio valued at $52,000 that has a beta of 1.16. You have another $10,000 to invest and would like to invest it in a manner such that the portfolio beta decreases to 1.15. What does the beta of the new investment have to be?

Reference no: EM131351780

Questions Cloud

Firms choose to make large increases in their dividends : Why do firms choose to make large increases in their dividends or start a stock repurchase program? Why would they choose one of these payout methods over another? Why do firms choose to cut or eliminate their dividends? What usually happens to the s..
Find the mean median and mode of this data : Suppose Tennessee received heavy rain in May totaling 8.2 inches. If this figure were used for May, how would the measures of central tendency be affected?
Implemented activity-based costing : Ritz Company sells fine collectible statues and has implemented activity-based costing. Costs in the shipping department have been divided into three cost pools. During the period, the Far East sales office generated 697 orders for a total of 6,020 i..
Explain epidemiology : 1. Explain epidemiology and how, through its study, we can determine the factors affecting the health and illness of populations.
What does the beta of the new investment have to be : You currently own a portfolio valued at $52,000 that has a beta of 1.16. You have another $10,000 to invest and would like to invest it in a manner such that the portfolio beta decreases to 1.15. What does the beta of the new investment have to be?
Choose the target market for your product : Use the same company from your Week 2 assignment.  My week 2 assignment was based on Del Taco specifically, but the fast food industry overall. I will attach that paper here as well. Your company has decided to launch a new line of products.
What are the implications associated : Why do you see increases and decreases in the invasive species population and what are the implications associated with these alterations to the ecosystem as a whole?
How many shares will be outstanding after the repurchase : The balance sheet for Levy Corp. is shown here in market value terms. There are 6,000 shares of stock outstanding. Market Value Balance Sheet Cash $ 44,900 Equity $ 474,900 Fixed assets 430,000 Total $ 474,900 Total $ 474,900 Instead of a dividend of..
Find the median class of the frequency distribution : The store manager of a discount department store is studying the weekly wages of the part-time employees. The table profiles the employees.

Reviews

Write a Review

Financial Management Questions & Answers

  What is the bond price

Mur Corps bonds mature in 8 years, with a par value of $1,000, and an annual coupon rate of 6.5% The market requires an interest rate of 8.2% on these bonds. What is the bond's price?

  Do you agree with the conviction and acted ethically

Martha Stewart and her Investment Counselor were indicted, convicted, and did jail time for insider trading. Go on the Internet and find an article about Martha’s case. Do you think they acted ethically? Do you agree with the conviction? Explain why ..

  Gold futures contract with current price

A gold futures contract with current price $650 has a maturity of two years. If the T-bill rate is 4%, what should the futures price be?

  Expected return-beta and expected return

Stock Y has a beta of .87 and an expected return of 9.80 percent. Stock Z has a beta of .70 and an expected return of 9 percent. What would the risk-free rate have to be for the two stocks to be correctly priced relative to each other?

  Effects of adding the new product to its sale offerings

Green Woods sells speciality equipment for mountain climbers. It's sales for last year included $387000 of tents and $718000 of climbing gear. For the next year management decided to sell sleeping bags. As a result of this change sales projections fo..

  Find her monthly payment by formula method and table method

Jane purchased her first home for $95,000. She made a down payment of 20% and financed the rest at 8% for 20 years. Find her monthly payment by both the formula method and the table method.

  What is the present value of the perpetuity

Suppose Auburn plans to pay Coach Malzahn a perpetuity if he wins a National Championship this season. The payment will be $37,000 each year for the rest of his life. Assume a 6% real interest rate. What is the present value of the perpetuity?

  Determine the annual effective interest rate

On January 1, 2006, Matt is obligated to make annual level payments for 16 years, beginning with a payment on January 1, 2007. His financial adviser told him that this liability has a Macaulay duration of 7.39 years. Determine the annual effective in..

  Recently cut interest rates and lowered reserve requirements

To boost a sluggish economy, China’s central bank recently cut interest rates and lowered reserve requirements. How would these new developments affect the US monetary policy? Explain.

  Calculate the ebit eps indifference point

Calculate the EBIT-EPS indifference point.- Calculate the expected EPS for both financing plans.- What factors should the company consider in deciding which financing plan to adopt?

  According to the dividend growth model

You’ve collected the following information from your favorite financial website. Stock (Div) SIR Company 2.40 High 131.01 Low 69.90 Div Yield 2.7% PE Ratio 10 Closing Price 89.05 Net Change 3.07 According to your research, the growth rate in dividend..

  What is the payback period and net present value

A 3-year project project with an initial cost of $2,704 promises the following cash flows for years 1 through 3, respectively: $1,653, $1,501, $1,495. If you require a 5.8 percent rate of return on this project, what is the net present value? A proje..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd