What will be required return on your portfolio

Assignment Help Financial Management

Reference no: EM131609690

You have been managing a $5 million portfolio that has a beta of 1.40 and a required rate of return of 14%. The current risk-free rate is 4.25%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 0.70, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places.

Reference no: EM131609690

Questions Cloud

Prepare the journal to record the sale : On 12/14/2016, Willies' Groceries makes total credit card sales for $1400 with a finance company-issued credit card, Prepare the journal to record the sale

Why do interest rates vary among countries : Interest Rates Why do interest rates vary among countries? Why are interest rates normally similar for those European countries that use the euro.

Prepare the journal to record the initial purchase : Prepare the journal to record both the initial purchase of the treasury stock and the later sale to the workers

How many us dollars will you need for your purchase : Interpreting Exchange Rate Quotations Today you notice the following exchange rate quotations: $1 = 3.00 Argentine pesos.

What will be required return on your portfolio : If you invest the money in a stock with a beta of 0.70, what will be the required return on your $5.5 million portfolio?

What is the estimated value of the adr per share : Pricing ADRs Today, the stock price of Genevo Co. (based in Switzerland) is priced at SF80 per share. The spot rate of the Swiss franc (SF) is $.70.

Determine the bid-ask spread for the euro : Explaining Variation in Bid/Ask Spreads Go to the currency converter at finance.yahoo.com/currency and determine the bid/ask spread for the euro.

Compute the amount of this required annual contribution : The first contribution will be made on December 31, 2016. Compute the amount of this required annual contribution

Riskier stock exceed the required return on less risky stock : By how much does the required return on the riskier stock exceed the required return on the less risky stock?

User Account

All Pages