portfolio mgt

To answer these questions, we need more information, specifically the values of certain financial metrics. Jensen’s alpha, nonsystematic variance, and the decision about adding a stock to the market portfolio are typically determined using financial data, particularly historical returns and risk measures.

Jensen’s alpha (also known as Jensen’s measure) measures a stock’s risk-adjusted performance compared to a market index. It’s calculated as the difference between the stock’s actual return and the return that should be expected based on its risk (beta) and the market’s return.

Nonsystematic variance, on the other hand, measures the risk specific to an individual stock that is not related to the overall market risk (systematic risk). It’s usually calculated using historical return data.

The decision to add a stock to the market portfolio is typically based on factors like the stock’s beta, correlation with the market, and its contribution to diversification.

Without the specific financial data and calculations for each stock, it’s not possible to provide exact answers to these questions. You would need to have access to the relevant financial data for Stock A, Stock B, and Stock C to make these determinations.

If you have access to the financial data for these stocks, you can calculate Jensen’s alpha, nonsystematic variance, and assess which stock is least likely to add to the market portfolio based on various financial metrics.