Reward-to-risk ratios


Dingo Ltd shares have a beta of 1.5 and an expected return of 16%. Shares in White Shark Ltd have a beta of 0.70 and an expected return of 11.5%. If the risk-free rate is 5.5% and the market risk premium is 8%, are these shares correctly priced?

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Finance Basics: Reward-to-risk ratios
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