You hear on the news that the? S&P 500 was down 1.1% today relative to the risk-free rate? (the market's excess return was -1.1 % ). You are thinking about your portfolio and your investments in Zynga and Proctor and Gamble.
a. If Zynga's beta is 1.3, what is your best guess as to Zynga's excess return today?
b. If Proctor and Gamble's beta is 0.5, what is your best guess as to P&G's excess return today?