Forecast the expected return for the stock assuming the


Find a low-risk stock-Walmart or Kellogg would be a good candidate but any are welcome. Use monthly returns for the most recent three years to confirm that the beta is less than 1.0. Now estimate the annual standard deviation for the stock and the S&P index, and the correlation between the returns on the stock and the index. Forecast the expected return for the stock, assuming the CAPM holds, with a market return of 12% and a risk-free rate of 5%.

Request for Solution File

Ask an Expert for Answer!!
Finance Basics: Forecast the expected return for the stock assuming the
Reference No:- TGS01005668

Expected delivery within 24 Hoursrs