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Business, 21.06.2020 02:57 mamacita712

Suppose the risk-free rate of return is 5%, the market risk premium is 4%. a. Calculate the average rate of return for the market return, Stock X, and Stock Y. (4 points) b. Calculate the standard deviation of the rate of return for the market return, Stock X, and Stock Y. (4 points) c. Calculate the correlation between Stock X and the market return, between Stock Y and the market return. (4 points) d. Calculate the beta for Stock X and Stock Y. Calculate the required rate of return for Stock X and Stock Y. Are they underperformed or overperformed? (4 points) e. Construct a portfolio including 50% of Stock X and 50% of Stock Y. Calculate the portfolio’s average rate of return, standard deviation, and beta. (4 points)

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Suppose the risk-free rate of return is 5%, the market risk premium is 4%. a. Calculate the average...
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