An analyst estimates that the expected returns on the market (S&P/TSX Composite Index) is 12 percent, with a standard deviation of 15 percent, and the risk-free rate of return (Treasury bill rate) is at 5 percent. Using the following information about the variance of returns of some efficient portfolios, calculate their expected returns using the Capital Market Line approach.
Efficient Portfolio Variance

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The Answer of An analyst estimates that the expected returns on the market (S&P/TSX Composite Index) is 12 percent, with a standard deviation of 15 percent, and the risk-free rate of return (Treasury bill rate) is at 5 percent. Using the following information about the variance of returns of some efficient portfolios, calculate their expected returns using the Capital Market Line approach.
Efficient Portfolio Variance

An Analyst Estimates That the Expected Returns on the Market