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Expected Portfolio Returns Analysis

This document contains a portfolio analysis calculating the expected returns of a Rs. 100,000 portfolio consisting of 5 stocks - TCS, ABB, ACC, Suzlon, and ICICI Bank. It lists the price, weightage, beta value, and weighted beta of each stock. It then calculates the beta of the portfolio as 1.056. Using the risk-free rate of 4.68% and expected market returns of 15%, it determines the expected portfolio returns are 15.57%.

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Rashmi Rathore
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51 views1 page

Expected Portfolio Returns Analysis

This document contains a portfolio analysis calculating the expected returns of a Rs. 100,000 portfolio consisting of 5 stocks - TCS, ABB, ACC, Suzlon, and ICICI Bank. It lists the price, weightage, beta value, and weighted beta of each stock. It then calculates the beta of the portfolio as 1.056. Using the risk-free rate of 4.68% and expected market returns of 15%, it determines the expected portfolio returns are 15.57%.

Uploaded by

Rashmi Rathore
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Name :

Roll No. :

The Expected Portfolio Returns of a sum of Rs 1,00,000 consisting of following stocks

would be-

S. No Company Price Weightage β- value βwi


1 TCS 1135.50 0.25 0.89 0.0675
2 ABB 747.30 0.10 0.87 0.057
3 ACC 1029.25 0.10 0.73 0.062
4 Suzlon 53.65 0.25 1.51 1.64
5 ICICI Bank 1,068.90 0.30 1.56 0.492
     Total = 1.00   1.056

Β-value of Portfolio (βp) = 1.056

Risk- free Rate = 4.68 % (364 Day Central Govt- Treasury Bill)

Expected Market returns, ∑(R)m = 15% ( According to Mr. Rakesh Jhunjhunwala’s interview to
ddddddddddddddd CNBC TV 18- as given in the website, for a time-period of 1-year)

Expected Returns of Portfolio = Risk- free Rate + Risk Premium

= Rf + βp [ ∑(R)m - Rf ]

= 4.68 % + 1.056 [15% - 4.68%]

= 4.68 % + 1.056 [10.32]

= 4.68% + 10.987 %

= 15.57 %

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