Homework Answers
A portfolio is as risky as market meaning beta of portfolio is 1
(1.3*20000+1.1*x+(100000-20000-x)*0)/100000=1
=>x=(1*100000-1.3*20000)/1.1
=>x=67272.72727
Expected
return=(0.0881*20000+0.0807*67272.72727+0.04*(100000-20000-67272.72727))/100000=0.07700
Add Answer to:
Problem 9 Intro You have $100,000 to invest and want to choose between two stocks and...
Problem 2 Intro We know the following expected returns for stocks A and B.glven different states...
Problem 2 Intro We know the following expected returns for stocks A and B.glven different states of the economy: 0.04 State (s) Probability E(ra) Ers,s) Recession 0.2 -0.1 Normal 0.5 0.08 0.05 Expansion 0.3 0.18 0.07 - Attempt 1/5 for 10 pts. Part 1 What is the expected return for stock A? 3+ decimals Submit Attempt 175 for 10 pts. Part 2 What is the expected return for stock B? Submit Problem 9 Intro You have $100,000 to invest and...
You have $100,000 that you want to invest in a risky asset portfolio; M. Portfolio M...
You have $100,000 that you want to invest in a risky asset portfolio; M. Portfolio M has an expected return of 20% and a standard deviation of 30%. You also want to borrow an extra $50,000 at a risk-free rate of 8% and invest in the risky portfolio. Calculate the expected return and standard deviation of this portfolio. What type of portfolio is this and what type of investors will invest in this portfolio?
You have $98,483 to invest in two stocks and the risk-free security. Stock A has an...
You have $98,483 to invest in two stocks and the risk-free security. Stock A has an expected return of 10.18 percent and Stock B has an expected return of 11.04 percent. You want to own $25,007 of Stock B. The risk-free rate is 5.16 percent and the expected return on the market is 12.39 percent. If you want the portfolio to have an expected return equal to that of the market, how much should you invest (in $) in the...
You have $99,445 to invest in two stocks and the risk-free security. Stock A has an...
You have $99,445 to invest in two stocks and the risk-free security. Stock A has an expected return of 13.34 percent and Stock B has an expected return of 11 percent. You want to own $30,372 of Stock B. The risk-free rate is 3.03 percent and the expected return on the market is 10.49 percent. If you want the portfolio to have an expected return equal to that of the market, how much should you invest (in $) in the...
You have $87,569 to invest in two stocks and the risk-free security. Stock A has an...
You have $87,569 to invest in two stocks and the risk-free security. Stock A has an expected return of 12.38 percent and Stock B has an expected return of 9.36 percent. You want to own $28,905 of Stock B. The risk-free rate is 5.06 percent and the expected return on the market is 12.04 percent. If you want the portfolio to have an expected return equal to that of the market, how much should you invest (in $) in the...
You have $81,871 to invest in two stocks and the risk-free security. Stock A has an...
You have $81,871 to invest in two stocks and the risk-free security. Stock A has an expected return of 13.17 percent and Stock B has an expected return of 10.03 percent. You want to own $29,241 of Stock B. The risk-free rate is 5.21 percent and the expected return on the market is 11.24 percent. If you want the portfolio to have an expected return equal to that of the market, how much should you invest (in $) in the...
You own a portfolio equally invested in a risk-free asset and two stocks. If one of...
You own a portfolio equally invested in a risk-free asset and two stocks. If one of the stocks has a beta of 1.61 and the total portfolio is equally as risky as the market, what must the beta be for the other stock in your portfolio? Answer to two decimals. Thank you !!
You own a portfolio equally invested in a risk-free asset and two stocks (If one of...
You own a portfolio equally invested in a risk-free asset and two stocks (If one of the stocks has a beta of 0.97 and the total portfolio is equally as risky as the market, what must the beta be for the other stock in your portfolio? (Hint: Remember that the market has a Beta=1; also remember that equally invested means that each asset has the same weight- since there are 3 assets, each asset's weight is 1/3 or 0.3333). Enter...
You want to create a portfolio equally as risky as the market, and you have $1,000,000...
You want to create a portfolio equally as risky as the market,
and you have $1,000,000 to invest. Given this information, fill in
the rest of the following table:
Please answer using excel
Asset Investment Beta StockA .80 $185,000 $320,000 1.13 Stock B Stock C Risk-free asset 1.29 Portfolio beta Total investment Investment Beta Asset Stock A Stock B Stock C Risk-free asset Output area: Investment Beta Asset Stock A Stock B Stock C Risk-free asset
You have $10,000 to invest in a portfolio containing Stock R, Stock S, and a risk-free...
You have $10,000 to invest in a portfolio containing Stock R, Stock S, and a risk-free asset. You must invest all of your money. Your goal is to create a portfolio that has an expected return of 15% and that has only 120% of the risk of the overall market. If Stock R has an expected return of 25% and a beta of 1.6, Stock S has an expected return of 17.5% and a beta of 1.3, and the risk-free...
Problem 2 Intro We know the following expected returns for stocks A and B.glven different states of the economy: 0.04 State (s) Probability E(ra) Ers,s) Recession 0.2 -0.1 Normal 0.5 0.08 0.05 Expansion 0.3 0.18 0.07 - Attempt 1/5 for 10 pts. Part 1 What is the expected return for stock A? 3+ decimals Submit Attempt 175 for 10 pts. Part 2 What is the expected return for stock B? Submit Problem 9 Intro You have $100,000 to invest and...
You have $99,445 to invest in two stocks and the risk-free security. Stock A has an expected return of 13.34 percent and Stock B has an expected return of 11 percent. You want to own $30,372 of Stock B. The risk-free rate is 3.03 percent and the expected return on the market is 10.49 percent. If you want the portfolio to have an expected return equal to that of the market, how much should you invest (in $) in the...
You want to create a portfolio equally as risky as the market,
and you have $1,000,000 to invest. Given this information, fill in
the rest of the following table:
Please answer using excel
Asset Investment Beta StockA .80 $185,000 $320,000 1.13 Stock B Stock C Risk-free asset 1.29 Portfolio beta Total investment Investment Beta Asset Stock A Stock B Stock C Risk-free asset Output area: Investment Beta Asset Stock A Stock B Stock C Risk-free asset
Most questions answered within 3 hours.
-
In the long run, an increase in the quantity of money ________
the value of money...
asked 1 minute ago -
In February 2008, a team of Canadian scientists revealed rare
new horseshoe crab fossils from 445...
asked 6 minutes ago -
a firm produces output according to the following function q=
f(L,K) = L^1/2K^3/2. The cost of...
asked 5 minutes ago -
Please
NO HANDWRITING
NO COPY & PASTE from the internet
On March 6, 2019, Mark Zuckerberg...
asked 6 minutes ago -
Please make a JAVA program for the following using switch
structures
Write a program that simulates...
asked 9 minutes ago -
in
2011, real gdp in the united states was below potential gdp. This
fact definitely means...
asked 10 minutes ago -
Describe how the file manager allocates a file to a single user.
List the steps that...
asked 34 minutes ago -
For the following reaction:
IBr(g) + 4F2(g) → IF5(g) +
BrF3(g)
Compound
ΔH°f (kJ mol-1)...
asked 36 minutes ago -
Assuming the simple probability of even A is given as P(A) and
the simple probability of...
asked 38 minutes ago -
2.- It is known that 20% of the students on campus are smokers.
If 8 students...
asked 38 minutes ago -
Provide a summary/reflection of what you gleaned of how law
enforcement is effect by Unconventional Weapons...
asked 59 minutes ago -
From the following heats of combustion,
CH3OH(l) + 3/2O2(g) → CO2(g) +
2H2O(l)
ΔHorxn = –726.4...
asked 53 minutes ago