What should be the average beta of the new stocks added to


A mutual fund manager has a $20 million portfolio with a beta of 1.50. The risk-free rate is 6.00%, and the market risk premium is 5.0%. 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 12%. What should be the average beta of the new stocks added to the portfolio? Do not round intermediate calculations. Enter a negative answer with a minus sign.

Request for Solution File

Ask an Expert for Answer!!
Financial Management: What should be the average beta of the new stocks added to
Reference No:- TGS02322977

Expected delivery within 24 Hours