Assume that both x and y are well diversified portfolios, Ask an Expert

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Assume that both X and Y are well diversified portfolios and the risk free rate is 4%.

Portfolio Expected Return Beta

A 7% .73

B 9% 1.00

In this situation, show how you could create an arbitrage profit. Suppose you iniate this abitrage trade with $100,000, what would be your trade postions and profits. SHOW ALL WORK.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92703985

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