Fama-french three-factor modela financial analyst has, Ask an Expert

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Fama-French Three-Factor Model

A financial analyst has modelled the stock of the company using a Fama-French three-factor model. The risk-free rate is 5%; the market return is 10%; the return on the SMB portfolio (rSMB) is 3.8%; and the return on the HML portfolio (rHML) is 4.7%. Ifai = 0, bi = 1.2, ci = - 0.4, and di = 1.3, what is the stock's predicted return?

Round your answer to two decimal places.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91381177

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