Question: You plan to invest in a Hedge Fund, which has a total capital of $500

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Question: You plan to invest in a Hedge Fund, which has a total capital of $500 million invested in 5 stocks. Stock A 140 million Beta: 0.5 Stock B 120 million Beta: 2.0 Stock C 100 million Beta: 4.0 Stock D 80 million Beta: 1.0 Stock E 60 million Beta: 3.0 The risk free rate is 4.87% and you believe the following probability distribution for future market returns is realistic: Probability Market Return 0.1 4% 0.2 5% 0.4 7% 0.2 9% 0.1 10% What is the market required return of the fund portfolio?

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Question: You plan to invest in a Hedge Fund, which has a total capital of $500

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