Investing Questions and Answers

Correlation is1. A's return is 9% and mkt index return is 11%. Risk free rate is 3%. What is the implied beta?

I am having confusion beside this question!


Answers: Expected return = Rf + b(Rm - Rf)

Rf = Risk free rate
Rm = Market return
b = beta

1) plug what we know into the formula ---> .09 = .03 +b(.11 - .03)

2) Solve for b... .09 - .03 = b(.08) -----> b = .75

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Pick 1 individual stock to hold long term and why.?




Answers: BTUI. A small cap semi conductor with 0 debt. They are now into solar panels and should do well with $100 oil.
Energy stocks.

because we are running out of gas.

now it's a good time to start looking for alternative energy stocks

also.. technology stocks and healthcare.
due to good future outlook and good account statement

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