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Calculating Risk and Return of Investments in a Portfolio (Part B)
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EXCERPTS
Shangvi gained the reputation of being a white knight for companies in trouble. However, all but one of his investments had been in pharma companies, his area of expertise. His investment in Suzlon was the only one in a company not in the pharma sector. According to analysts, Shangvi’s investment would diversify the portfolio for managing risks compared to returns... |
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ASSIGNMENT QUESTIONS
1. Calculate Beta for the investments (Suzlon and Natco Pharma) of Shangvi.
2. Calculate the expected return of the investments using the CAPM model.
3. Determine whether the investments have been undervalued or overvalued by SML.
