Ünite Sınavı Soruları

Which one below is about the Degree of Operating Leverage of the factors that affect the Beta of a firm?

Those stocks the returns of which are relatively more sensitive to changes in the market returns have a higher ………… and …………...

I.It is the rate of return that investors require to invest in risk free investments in that environment.

II.The short term T-Bill rate is usually used to measure it. 

III.The Risk premium is the return in excess of the risk-free rate that investors require to compensate for the risk of an investment.

Which one/ones above is/are correct about risk free returns?

What is the maximum value for the correlation of securities to provide a benefit from diversification? 

Suppose that you invest 30% of your money in security A, %50 in security B and the rest in security C. The expected returns of A, B and C are given as 10%, 8% and 5% respectively. What is your expected rate of return for this investment?