WebFor the following sets of questions assume the expected return on the market is 9% (E[rm] = 0.09), with a volatility of 16% (0m = 0.16). Assume that the risk free rate is 1% (r = 0.01) (a) (5 pts) What is the market risk Premium? (b) (5 pts) Assume CAPM holds. Suppose a stock has an expected return WebExpected market return (r m ), a forecast of the market's return over a specified time. Because this is a forecast, the accuracy of the CAPM results are only as good as the …
Asset A has an expected return on the market E(Rm) of
WebNov 4, 2016 · I have worked out a solution on computing the expected return from the market portfolio E(Rm) when the following information is … WebQuestion: Asset A has an expected return on the market E(Rm) of 20%, a Beta of 1.6% and a risk free rate(Rf) of 8% Asset B has a beta of 1.2, an expected return on the market of 16% and a risk free rate (Rf) of 8%. You are required to apply an appropriate valuation model to determine which investment between the two is likely to attract a potential freelance makeup artist insurance uk
How do we compute Expected Return of the Market …
WebE(Rm) = Expected Return on the Market Index Using the Capital Asset Pricing Model * Inputs required to use the CAPM - (a) the current risk-free rate (b) the expected return on the market index and (c) the beta of the … WebFeb 3, 2024 · Expected return is just one of many potential returns since the investment market is highly volatile. You can calculate expected return as a weighted average … WebThe formula of expected return for an Investment with various probable returns can be calculated as a weighted average of all possible returns which is represented as below, Expected return = (p1 * r1) + (p2 * r2) + ………… + (pn * rn) p i = Probability of each return r i = Rate of return with different probability. freelance makeup artist business plan