CFA CFA Level 1 Question of the Week – Portfolio Management

Question of the Week – Portfolio Management

  • This topic has 2 replies, 2 voices, and was last updated Jun-18 by Mamapato1.
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  • AdaptPrep
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    The standard deviation of the market portfolio is 0.2. The beta of a company with standard deviation 0.6 and market correlation of 0.4 is closest to:

    • 0.8
    • 1
    • 1.2
    AdaptPrep
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    Beta = (correlation) * (security
    std dev) / (market std dev)

    = 0.4 * 0.6 / 0.2

    = 1.2

    Mamapato1
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    okay

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