Multiple Choice
Stock A has a beta of 1.2 and a standard deviation of 25%. Stock B has a beta of 1.4 and a standard deviation of 20%. Portfolio AB was created by investing in a combination of Stocks A and B. Portfolio AB has a beta of 1.25 and a standard deviation of 18%. Which of the following statements is CORRECT?
A) Stock A has more market risk than Portfolio AB.
B) Stock A has more market risk than Stock B but less stand-alone risk.
C) Portfolio AB has more money invested in Stock A than in Stock B.
D) Portfolio AB has the same amount of money invested in each of the two stocks.
Correct Answer:
Verified
Correct Answer:
Verified
Q26: Stock A's stock has a beta of
Q98: Stocks A,B,and C all have an expected
Q121: Bob has a $50,000 stock portfolio with
Q122: The distributions of rates of return for
Q123: Which of the following statements is CORRECT?<br><br>A)
Q123: Under the CAPM, the required rate of
Q124: Other things held constant,if the expected inflation
Q126: The slope of the SML is determined
Q126: Assume that you hold a well-diversified portfolio
Q127: Mike Flannery holds the following portfolio: <img