A Stock Has a Return of 16

question 84

Multiple Choice

A stock has a return of 16.18 percent and a beta of 1.47.The market return is 10.65 percent and the risk-free rate is 3.20 percent.What is the Jensen-Treynor alpha of this stock?

• A) −1.12 percent
• B) −0.17 percent
• C) 0.66 percent
• D) 1.38 percent
• E) 1.59 percent

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Definitions:

Reproductive Success

The passing of genes to the next generation in a way that they too can pass those genes on.

Dilemma Of The Rarely Exercised Option

A situation in which an available choice is seldom selected, despite its potential benefits, due to factors like risk or uncertainty.

Reproductive Success

An organism's ability to pass its genes onto the next generation, often measured by the number of offspring that survive to reproductive age.

Physical Attractive

The degree to which a person's physical traits are considered aesthetically pleasing or beautiful.