A risky equity portfolio generates returns that have a covariance with the market portfolio of 0.085. The market portfol
Posted: Wed Mar 30, 2022 3:40 pm
A risky equity portfolio generates returns that have a
covariance with the market portfolio of 0.085. The market portfolio
is expected to generate a return of 0.085 per month with a standard
deviation of returns of 0.25. The T-Bills rate is currently 0.005
per month. According to the CAPM, what is the expected monthly
return of the risky portfolio?
covariance with the market portfolio of 0.085. The market portfolio
is expected to generate a return of 0.085 per month with a standard
deviation of returns of 0.25. The T-Bills rate is currently 0.005
per month. According to the CAPM, what is the expected monthly
return of the risky portfolio?