Assume that you are the portfolio manager of the sf fund a


Assume that you are the portfolio manager of the SF Fund, a $3 million hedge fund that contains the following stocks. The required rate of return on the market is 11.00% and the risk-free rate is 2.00%. What rate of return should investors expect (and require) on this fund?

Company Amount Beta
Stock A $925,000 1.20
Stock B $675,000 0.50
Stock C $900,000 1.40
Stock D $500,000 0.75

$3,000,000



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Finance Basics: Assume that you are the portfolio manager of the sf fund a
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