Calculate the expected return of portfolio


Problem:

Suppose you manage a stock portfolio with a beta of 1.3. There is no dividend yield and the risk-free rate is 3.4% per annum. In 4 months, the S&P500 index changes by 10%.

Task:

Question: Calculate the expected return of your portfolio in 4 months. Please provide step by step solution.

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Finance Basics: Calculate the expected return of portfolio
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