00:01
Hello, okay, so we're going over some portfolios here, so let's write down some of our given information that's been provided for us.
00:06
So i'll be right back with that.
00:08
All right, so we're back.
00:09
We have a risk -free rate is equal to 3 .11 percent.
00:12
Our s &p market return is equal to 12 .87 percent.
00:15
Our portfolio abc return is 15 .75 percent.
00:18
Our portfolio xyz return is equal to 11 .92 percent.
00:22
Our portfolio abc beta is equal to 1 .4 and our portfolio xyz beta is 0 .85.
00:28
So first, we have to write down our trainer index equation.
00:31
All right, so that's how our equation is going to look like.
00:39
Our trainer index is going to equal our portfolio return minus our risk -free rate over our beta.
00:44
So that's going to equal 15 .75 percent minus 3 .11 percent over 1 .4 and you get approximately 9 .45 percent.
00:56
And so now we could do the same thing for our xyz portfolio...