What should be the average beta of the new stocks added

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Reference no: EM13302512

A mutual fund manager has a $20,000,000 portfolio with a beta of 0.80. The risk-free rate is 5.00% and the market risk premium is 6.0%. The manager expects to receive an additional $5,000,000 which she plans to invest in a number of stocks. After investing the additional funds, she wants the fund's required return to be 20%. What should be the average beta of the new stocks added to the portfolio? Round your answer to two decimal places.

Reference no: EM13302512

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