What is the required rate of return for this investment

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Reference no: EM13921055

The return on the market is 9.5% and the risk free rate is 3%. The investor is aggressive and his beta (B) is 1.25.

A) What is the required rate of return for this investment using the CAPM approach?

B) If you are a strict risk minimize, which stock from below would you choose if it is to be held in isolation?

Stock One Standard Deviation Beta

A 20% 0.59

B 10% 0.61

C 12% 1.29

Reference no: EM13921055

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