{"id":27395,"date":"2021-02-01T08:58:31","date_gmt":"2021-02-01T08:58:31","guid":{"rendered":"http:\/\/onlineclassesguru.com\/?p=27395"},"modified":"2021-02-01T08:58:31","modified_gmt":"2021-02-01T08:58:31","slug":"evaluation-of-portfolio-beta-and-the-required-return-on-stockthe-tendency-of-a-stocks-price-to-move-up-and-down-with-the-market-is-reflected-in-its-beta-coefficient-therefore-beta-is-a-meas","status":"publish","type":"post","link":"https:\/\/onlineclassesguru.com\/index.php\/2021\/02\/01\/evaluation-of-portfolio-beta-and-the-required-return-on-stockthe-tendency-of-a-stocks-price-to-move-up-and-down-with-the-market-is-reflected-in-its-beta-coefficient-therefore-beta-is-a-meas\/","title":{"rendered":"EVALUATION OF PORTFOLIO BETA AND THE REQUIRED RETURN ON STOCKThe tendency of a stock\u2019s price to move up and down with the market is reflected in its beta coefficient. Therefore, beta is a measure of an investment\u2019s market risk, and is a key element of the CAPM"},"content":{"rendered":"<style type=\"text\/css\"><\/style><p>EVALUATION OF PORTFOLIO BETA AND THE REQUIRED RETURN ON STOCKThe tendency of a stock\u2019s price to move up and down with the market is reflected in its beta coefficient. Therefore, beta is a measure of an investment\u2019s market risk, and is a key element of the CAPM.In this part of the project, you get financial information using Yahoo!Finance (found athttp:\/\/finance.yahoo.com\/)To find a company\u2019s beta, enter the desired stock symbol and request a basic quote. Once you have the basic quote, select the\u201dKey Statistics\u201d. Scroll down this page to find the stock\u2019s beta.In your initial response to the topic you have to answer all 5questions.From Yahoo!Finance obtain a reporton any two companies.What are the betas listed for these companies?If you made an equal dollar investment in each stocks what would be the beta of your portfolio?If you made 70% of dollar investment in stock A, and 30% of dollar investment in stock B, what would be the beta of your portfolio? Please show your work.Apply the Capital Asset Pricing Model (CAPM) Security Market Line to estimate the required return on these two stocks.Assumptions and Data: Note that you will need the risk-free rate and the market risk premium. Assume a 5% market risk premium. To get the current yield on 10-year Treasury securities go to Finance!Yahoo\u2019s (www.finance.yahoo.com) -click on Market Data \u2013 Bonds.You will use the current yield on 10-year Treasury securities as the risk-free rate to estimate the required rate of return on stocks.Compare the required return on these stocks calculated using CAPM in question #3 against their historical return over the last 52 weeks, found in the Yahoo!Finance \u2013 Key Statistics. Is there a difference between these returns? Is this a problem? Why is there a difference?<\/p>\n<p><center><a href=\"http:\/\/onlineclassesguru.com\/orders\/ordernow\"><img decoding=\"async\" src=\"https:\/\/encrypted-tbn0.gstatic.com\/images?q=tbn:ANd9GcTyj99p60XCLyLk1htB7-1neRt8-2QdnenNlQ&usqp=CAU\"target=\"_http:\/\/onlineclassesguru.com\/orders\/ordernow\"\/><\/center><p>","protected":false},"excerpt":{"rendered":"<p>EVALUATION OF PORTFOLIO BETA AND THE REQUIRED RETURN ON STOCKThe tendency of a stock\u2019s price to move up and down with the market is reflected in its beta coefficient. Therefore, beta is a measure of an investment\u2019s market risk, and is a key element of the CAPM.In this part of the project, you get financial&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-27395","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v17.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>EVALUATION OF PORTFOLIO BETA AND THE REQUIRED RETURN ON STOCKThe tendency of a stock\u2019s price to move up and down with the market is reflected in its beta coefficient. Therefore, beta is a measure of an investment\u2019s market risk, and is a key element of the CAPM - onlineclassesguru<\/title>\n<meta name=\"description\" content=\"EVALUATION OF PORTFOLIO BETA AND THE REQUIRED RETURN ON STOCKThe tendency of a stock\u2019s price to move up and down with the market is reflected in its beta coefficient. 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