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Find the average beta of new stocks added to portfolio

PORTFOLIO BETA A mutual fund manager has a $20 million portfolio with a beta of 1.5. The risk-free rate is 4.5%, and the market risk premium is 5.5%. The manager expects to receive an additional $5 million, which she plans to invest in a number of stocks. After investing the additional funds, she wants the fund's required return to be 13%. What should be the average beta of the new stocks added to the portfolio?

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Find the average beta of new stocks added to portfolio

Reference No:- TGS0680365

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

Q : Find preferred project for given bank account interest rate

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Find the average beta of new stocks added to portfolio

Reference No:- TGS0680365

Recent Questions Asked Finance Basics

Q : Find preferred project for given bank account interest rate

Q : The new equipment has a payback period

Q : Financial manager place in corporation

Q : Prepare one to two page document listing

Q : Find the average beta of new stocks added to portfolio

Q : What is the net profit of the birm with this strategy

Q : What will be difference in required returns for hri and lri

Q : Assignment related to biostatistics

Q : How much subscription revenue will hen house

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