Question

The geometric average annual return for a large capitalization stock portfolio is 12% for ten years and 6% per year for the n

0 0
Add a comment Improve this question Transcribed image text
Answer #1

geometric average return for the entire 15 year period is

=(((1*(1+12%)^10*(1+6%)^5)/1)^(1/15))-1

=9.96%

Add a comment
Know the answer?
Add Answer to:
The geometric average annual return for a large capitalization stock portfolio is 12% for ten years...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • (Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle...

    (Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle Company had the following end-of-year stock prices over the last five years and paid no cash dividends: Time Brangus cattle Comapny $15 11 24 28 a. Calculate the annual rate of return for each year from the above information b. What is the arithmetic average rate of return earned by investing in Brangus Cattle Company's stock over this period? c. What is the geometric...

  • You observe a portfolio for five years and determine that its average annual return is 13%...

    You observe a portfolio for five years and determine that its average annual return is 13% and the standard deviation of its returns is 21%. Can you be 95% confident that this portfolio will not lose more than 30% of its value next year? Yes No

  • Caswell Enterprises had the following end-of-year stock prices over the last five years and paid no...

    Caswell Enterprises had the following end-of-year stock prices over the last five years and paid no dividends. Time Caswell 1 $12 2 9 3 7 4 6 5 12 Calculate the annual rate of return for each year from the above information. What is the arithmetic average rate of return earned by investing in Caswell's stock over this period? What is the geometric average rate of return earned by investing in Caswell's stock over this period? Considering the beginning and...

  • You are analyzing the historical performance of a stock. The annual returns for the last ten...

    You are analyzing the historical performance of a stock. The annual returns for the last ten years are shown below. Year Ann Ret 2018 12% 2017 9% 2016 ‐5% 2015 3% 2014 ‐13% 2013 6% 2012 20% 2011 0% 2010 ‐6% 2009 14% Calculate the average annual return, the variance and standard deviation of this stock over the ten‐year period.

  • Caswell Enterprises had the following end-of-year stock prices over the last five years and paid no...

    Caswell Enterprises had the following end-of-year stock prices over the last five years and paid no dividends. Time Caswell 1 $12 2 9 3 7 4 6 5 12 Calculate the annual rate of return for each year from the above information. What is the arithmetic average rate of return earned by investing in Caswell's stock over this period? What is the geometric average rate of return earned by investing in Caswell's stock over this period? Considering the beginning and...

  • Following are the annual returns on a portfolio over each of the last three years: Year...

    Following are the annual returns on a portfolio over each of the last three years: Year Return 2011 10% 2012 15% 2013 20% What was the arithmetic average return and geometric average return over the past three years? What would be your average return if you invested $200,000 per year at the beginning of each of the last three years? What would be your average return if you invested $100,000 at the beginning of 2011, $200,000 at the beginning of...

  • Question 2: 2. Ms. Olson invested $100,000 in a portfolio of non-dividend paying stocks five years...

    Question 2: 2. Ms. Olson invested $100,000 in a portfolio of non-dividend paying stocks five years ago. The arithmetic average return on her portfolio was 9.0% per year, and the geometric average return was 8.5% per year during the five years. What is the value of her portfolio at the end of the five-year holding period? MOD ON S DOO Answer: W bomo 10 08 Show your calculations here. T o

  • Score: 0.33 of 1 pt 3 of 16 (15 complete) VB 11-12 (book/static) Ten annual returns...

    Score: 0.33 of 1 pt 3 of 16 (15 complete) VB 11-12 (book/static) Ten annual returns are listed in the following table: 16.6% 18.0 % -19.9% 50.0 % 1.2 % -16.5 % 43.3% 45.6% 45.2% -3.0% a. What is the arithmetic average return over the 10-year period? b. What is the geometric average return over the 10-year period? c. If you invested $100 at the beginning, how much would you have at the end? a. What is the arithmetic average...

  • 8)Would you buy this stock if your current portfolio average return is 8%? explain 7) The...

    8)Would you buy this stock if your current portfolio average return is 8%? explain 7) The next dividend payment annually. The stock currently d payment by HM Enterprises will be $1.82 per share with future increases of 2.8 percent stock currently sells for $38.70 per share. What is the dividend yield? Dividend Keld: Annal Divisend/ PO: 1:32/38.7 = 0.047 =( 47% 8) Unilever will pay an annual dividend of $3.20 will pay an annual dividend of $3.26 a share next...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT