Calculate the beta of assets , Financial Accounting

Assignment Help:

An investor holds a bullish view for the equity market over the next twelve months and wishes to recalibrate his portfolio to reflect this view. The investor's portfolio consists of two assets, asset A and asset B. The investor wants to gear the portfolio beta to 1.2. What weights must beheld in asset A and asset B to generate the desired portfolio beta level? Round all answers to two decimal places.

Inputs

σ24 = 94

σ2B = 94

σ2M= 94

σA,M = 94

σB,M = 94

βp = 94

Calculate the beta of assets A and B.


Related Discussions:- Calculate the beta of assets

Average cost of capital, Q. Average cost of capital? Even though the di...

Q. Average cost of capital? Even though the director suggests that equity finance is appropriate given the amount of finance needed the amount alone doesn't rule out other fina

Total amount capitalized for the patent account, Gomez incurred $350,000 of...

Gomez incurred $350,000 of research and development costs to develop a product for which a patent was granted on January 2, 2008. Legal fees and other costs associated with the reg

Net streams of payments, Swap - Financial contract in which 2 parties agree...

Swap - Financial contract in which 2 parties agree to exchange net streams of payments over a specified period. Payments are normally determined by applying different indices (for

Calculate the return on sales and asset turnover, Calculate the Return on S...

Calculate the Return on Sales and Asset Turnover 1. Complete a trend analysis for the items below for the last three years using the earliest year as the base year. Cash

Leases, Company A(lessee) will rent inventory for you for 3 years rather th...

Company A(lessee) will rent inventory for you for 3 years rather than buying it for the regular price of $240,000. Normally these units, which cost us $120,000 to produce, will las

Calculate the payback and discounted payback periods, Assume that the compa...

Assume that the company has an investment opportunity. Building a new factory would cost $750 million but would reduce cash operating costs by $150 million per year for the next 1

Mutual dealings-bankruptcy and liquidation, MUTUAL DEALINGS A right of ...

MUTUAL DEALINGS A right of set-off is allowed where there have been - (a) Mutual credits, debts or other dealings resulting in pecuniary liabilities, (b) Between the debtor an

Depreciation, what are methods of calculating depreciation?

what are methods of calculating depreciation?

Prepare financial report for large accounting firm, Question: You are a...

Question: You are a member of a large accounting firm which is responsible for preparing financial reports, including statements and notes to the accounts; and for advising sta

Prepare the income statement and balance sheet., Business start up accounti...

Business start up accounting transactions: Jane Whitfield, a sole proprietor, established the JW Flower Shop on January 2, 2010. The following transactions have occurred during

Write Your Message!

Captcha
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