A single mispriced asset has a reward to risk ratio of 0.5, while the market has a reward to risk ratio of 2.5. Given t
Posted: Sat Nov 27, 2021 5:16 pm
A single mispriced asset has a reward to risk ratio of 0.5,
while the market has a reward to risk ratio of 2.5. Given the
asset has a beta β = 2.0, in constructing an optimal allocation
between the mispriced asset and the market, what proportion of your
investment would you place in the mispriced asset?
while the market has a reward to risk ratio of 2.5. Given the
asset has a beta β = 2.0, in constructing an optimal allocation
between the mispriced asset and the market, what proportion of your
investment would you place in the mispriced asset?