What is the alpha of a portfolio with a beta of 2 and actual return of 15%?
A) 0%
B) 13%
C) 15%
D) 17%

Name: What is the alpha of a portfolio with a beta of 2 and actual return of 15%? A) 0% B) 13% C) 15% D) 17%
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Question

Quizplus · Accepted Answer

Alpha is calculated as the actual return minus the expected return. If the expected market return is assumed to be 15%, and the risk-free rate is 0%, then the expected return for a portfolio with a beta of 2 would also be 15%. Therefore, the alpha is 0%.

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