A Portfolio Has a Jensen's Alpha of 0

question 56

Multiple Choice

A portfolio has a Jensen's alpha of 0.82 percent,a beta of 1.40,and a CAPM expected return of 13.7 percent.The risk-free rate is 2.5 percent.What is the actual return of the portfolio?

• A) 15.5 percent
• B) 16.1 percent
• C) 16.8 percent
• D) 19.6 percent
• E) 21.9 percent

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Definitions:

Coping With Stress

The methods or strategies used by individuals to manage and mitigate stress.

Emotional Release

The process of expressing or letting go of repressed or intense emotions, which is often therapeutic and conducive to healing.

Ultimate Failure

The final and total inability to achieve a desired or intended outcome, often after various efforts.

Life's Stresses

The various types of pressures and adversities that individuals may encounter throughout their lives.