Manager of a small investment company successfully using index funds for the limited time the market. The growth has allowed it to move into stock picking. It considers two small and highly variable listed shares, but concerned about the risk that these investments could add to its "portfolio." Provides input to the CAPM. Students learn about the overall risk, non-diversifiable or portfolio risk, and (CAPM) beta, and calculate the volatility stocks separately, and the portfolio variance with and without reserves, to see how extremely risky (but low-beta) is actually stock reduces the risk.;, and calculate the stock beta "Hide
by Michael E. Edleson Source: HBS Premier Case Collection 5 pages. Publication Date: March 23, 1992. Prod. # 292 122-PDF-ENG
Related Case Solutions & Analyses:
Credit Suisse Group: Managing Equity Research as a Business
Corruption at Siemens (B)
How Serial Entrepreneurs Build and Manage a Board of Directors in a Venture-Backed Start Up
The Battle Over the Clinton Health Care Proposal (Sequel)
CDnow (B)
Kirin Brewery Co. Ltd. (B)
Wildfire Communications Inc. (C)
Growing Big While Staying Small: Starbucks Harvests International Growth
Your Strategy–A Strategy Formulation Exercise for the General Management Program (GMP)
Finance task
