Standard deviation is a measure of:- Select one: a. Risk associate with return of an index...
Standard deviation is a measure of:- Select one:
a. Risk associate with return of an index only b. Risk associate with return of a portfolio of stocks only c. All of these d. Risk associate with return of individual stock only
Homework Answers
d. Risk associate with return of individual stock only
Explanation:-
The Standard Deviation is known as the measure of the details of how spread out numbers.
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Standard deviation is a measure of:- Select one:
a. Risk associate with return of an index...
2. 3: Risk and Rates of Return: Risk in Portfolio Context Risk and Rates of Return:...
2. 3: Risk and Rates of Return: Risk in Portfolio Context Risk
and Rates of Return: Risk in Portfolio Context The capital asset
pricing model (CAPM) explains how risk should be considered when
stocks and other assets are held . The CAPM states that any stock's
required rate of return is the risk-free rate of return plus a risk
premium that reflects only the risk remaining diversification. Most
individuals hold stocks in portfolios. The risk of a stock held in...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 4%, and the marker's average return was 11%. Performance is measured using an index model regression on excess returns Index model regression estimates R-square Residual standard deviation, (e) Standard deviation of excess returns Stock A 1% + 1.2M - rf) 2.683 12.15 23.4% Stock 8 2% + 0.8( - rf) 2.49 20.93 28.5% a. Calculate the following statistics for each...
Assume that the assumptions of the CAPM hold. The expected return and the standard deviation of...
Assume that the assumptions of the CAPM hold. The expected return and the standard deviation of the market portfolio are 7% and 14%, respectively. There are two individual stocks A and B: Mean Return A: 4% Standard Deviation A: 18% Mean Return B: 12% Standard Deviation B: 36% Stock A has a correlation of 0.2 with the market portfolio. A.What is the beta of stock A? B.What is the risk free rate? C.What is the beta of a portfolio with...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 8%, and the market's average return was 13%. Performance is measured using an index model regression on excess returns. Index model regression estimates R-square Residual standard deviation, 0(e) Standard deviation of excess returns Stock A 1% + 1.2(M - rf) 0.659 11.7% 238 Stock B 2% + 0.8(IM - rf) 0.478 20.5% 27.7% a. Calculate the following statistics for each...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 7%, and the market's average return was 13%. Performance is measured using an index model regression on excess returns. Index model regression estimates R-square Residual standard deviation, o(e) Standard deviation of excess returns Stock A 1% + 1.2 (rm -rf) 0.629 11.2% 22.5% Stock B 2% + 0.8(rm -rf) 0.463 20% 26.7% a. Calculate the following statistics for each stock:...
I ONLY CAN SHOW ONE OPTIONS OF THEM 7. Using historical data to measure portfolio risk...
I ONLY CAN SHOW ONE OPTIONS OF THEM
7. Using historical data to measure portfolio risk and correlation coefficient Aa Aa Pam is an investor who believes that past variability of stocks is a reasonably good estimate of future risk associated with the stocks. Pam works on creating a new portfolio and has already purchased stock A. Now she considers two other stocks, B and C. Pam collected data on the historic rates of return for all three stocks, which...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate...
Consider the two (excess return) index-model regression results
for stocks A and B. The risk-free rate over the
period was 7%, and the market’s average return was 14%. Performance
is measured using an index model regression on excess returns.
Consider the two excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 7%, and the market's average return was 14%. Performance is measured using an index model regression on excess returns Stock A...
Problem 24-9 Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate...
Problem 24-9 Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 8%, and the market's average return was 13%. Performance is measured using an index model regression on excess returns. points Index model regression estimates 10 + re) Stock A 1.2(y- 0.659 11.78 238 Stock B 20 + 0.8(EM - 0.478 F Residual standard deviation, die Standard deviation of excess returns a. Calculate the following statistics for each stock...
7. Using historical data to measure portfolio risk and correlation coefficient Peter is an investor who...
7. Using historical data to measure portfolio risk and correlation coefficient Peter is an investor who believes that past variability of stocks is a reasonably good estimate of future risk associated with the stocks. Peter works on creating a new portfolio and has already purchased stock A. Now he considers two other stocks, B and C. Peter collected data on the historic rates of return for all three stocks, which are presented in the following table. Complete the table by...
9. You are currently holding stock A which has expected return of 10% and standard deviation...
9. You are currently holding stock A which has expected return of 10% and standard deviation of 3%. You would like to add one of the following two stocks (so you would like to have a portfolio with two stocks): В 10% 10% E(r) o(i) 4% 2% a. Which stock should you buy assuming that all three stocks are uncorrelated and you can only purchase one of the stocks B or C? b. Now assume that p(A,B) 0.5 and p(A,C)...
2. 3: Risk and Rates of Return: Risk in Portfolio Context Risk
and Rates of Return: Risk in Portfolio Context The capital asset
pricing model (CAPM) explains how risk should be considered when
stocks and other assets are held . The CAPM states that any stock's
required rate of return is the risk-free rate of return plus a risk
premium that reflects only the risk remaining diversification. Most
individuals hold stocks in portfolios. The risk of a stock held in...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 4%, and the marker's average return was 11%. Performance is measured using an index model regression on excess returns Index model regression estimates R-square Residual standard deviation, (e) Standard deviation of excess returns Stock A 1% + 1.2M - rf) 2.683 12.15 23.4% Stock 8 2% + 0.8( - rf) 2.49 20.93 28.5% a. Calculate the following statistics for each...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 8%, and the market's average return was 13%. Performance is measured using an index model regression on excess returns. Index model regression estimates R-square Residual standard deviation, 0(e) Standard deviation of excess returns Stock A 1% + 1.2(M - rf) 0.659 11.7% 238 Stock B 2% + 0.8(IM - rf) 0.478 20.5% 27.7% a. Calculate the following statistics for each...
Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 7%, and the market's average return was 13%. Performance is measured using an index model regression on excess returns. Index model regression estimates R-square Residual standard deviation, o(e) Standard deviation of excess returns Stock A 1% + 1.2 (rm -rf) 0.629 11.2% 22.5% Stock B 2% + 0.8(rm -rf) 0.463 20% 26.7% a. Calculate the following statistics for each stock:...
I ONLY CAN SHOW ONE OPTIONS OF THEM
7. Using historical data to measure portfolio risk and correlation coefficient Aa Aa Pam is an investor who believes that past variability of stocks is a reasonably good estimate of future risk associated with the stocks. Pam works on creating a new portfolio and has already purchased stock A. Now she considers two other stocks, B and C. Pam collected data on the historic rates of return for all three stocks, which...
Consider the two (excess return) index-model regression results
for stocks A and B. The risk-free rate over the
period was 7%, and the market’s average return was 14%. Performance
is measured using an index model regression on excess returns.
Consider the two excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 7%, and the market's average return was 14%. Performance is measured using an index model regression on excess returns Stock A...
Problem 24-9 Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 8%, and the market's average return was 13%. Performance is measured using an index model regression on excess returns. points Index model regression estimates 10 + re) Stock A 1.2(y- 0.659 11.78 238 Stock B 20 + 0.8(EM - 0.478 F Residual standard deviation, die Standard deviation of excess returns a. Calculate the following statistics for each stock...
9. You are currently holding stock A which has expected return of 10% and standard deviation of 3%. You would like to add one of the following two stocks (so you would like to have a portfolio with two stocks): В 10% 10% E(r) o(i) 4% 2% a. Which stock should you buy assuming that all three stocks are uncorrelated and you can only purchase one of the stocks B or C? b. Now assume that p(A,B) 0.5 and p(A,C)...
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