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Possible Returns Probability Investment Investment Y .05 -10% 0% 5% 5% 20% 16% 25 30% 24%...
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of...
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of a 12% return; a 50% probability of a 16% return; and a 30% probability of a 19% return. What is the standard deviation of return for this investment? A) 5.89% B) 16.1% C) 2.43% D) 15.7% 6. Answer the questions below using the following information on stocks A, B, and C. Expected Return Standard Deviation Beta 20% 12% 1.8 21% 10% 2.2 10% 10%...
Problem 8-05 Two investments generated the following annual returns: Investment x 13% Investment Y 24% 22...
Problem 8-05 Two investments generated the following annual returns: Investment x 13% Investment Y 24% 22 19 20x0 20X1 20x2 20x3 20X4 16 a. What is the average annual return on each investment? Round your answers to one decimal place. The average annual rate of return on X: The average annual rate of return on Y: b. What is the standard deviation of the return on investments X and Y? Round your answers to two decimal places. Standard deviation of...
Problem 8-05 Two investments generated the following annual returns: Investment X Investment Y 20x0 13% 17...
Problem 8-05 Two investments generated the following annual returns: Investment X Investment Y 20x0 13% 17 % 20X1 24 20X2 18 20x3 14 20X4 12 a. What is the average annual return on each investment? Round your answers to one decimal place. The average annual rate of return on X: % The average annual rate of return on Y: b. What is the standard deviation of the return on investments X and Y? Round your answers to two decimal places....
Returns and Standard Deviations - Consider the following information: State of Economy Probability of State of...
Returns and Standard Deviations - Consider the following information: State of Economy Probability of State of Economy Rate of Return If State Occurs Stock A Stock B Stock C Boom .10 .35 .45 .27 Good .60 .16 .10 .08 Poor .25 −.01 −.06 −.04 Bust .05 −.12 −.20 −.09 Your portfolio is invested 30 percent each in A and C, and 40 percent in B. What is the expected return of the portfolio? What is the variance of this portfolio?...
12) Assume that an investment is forecasted to produce the following returns: a 30% probability of...
12) Assume that an investment is forecasted to produce the following returns: a 30% probability of a what is the 12% return; a 50% probability of a 16% return; and a 20% probability of a 19% return. expected percentage return this investment will produce? A) 16.1% B) 15.4% C) 33.3% D) 9.5%
You plan to make an investment. given the following probability distribution of returns, what is the...
You plan to make an investment. given the following probability distribution of returns, what is the expected return on the investment ? if the standard deviation of the return is $77,460, what is the CV of the investment ? market condition probability profit $000' good 30% 300 normal 40% 200 bad 30% 100
Portfolio Security Stock A Stock B Stock C Return 11% 16% 25% Probability 20% 30% 50%...
Portfolio Security Stock A Stock B Stock C Return 11% 16% 25% Probability 20% 30% 50% (1) (ii) Find its expected return of the portfolio. Find the standard deviation of the portfolio. [2 marks] (5 marks]
What are the expected return and standard deviation of the possible returns below? Economy Probability Return...
What are the expected return and standard deviation of the possible returns below? Economy Probability Return Good 0.60 25% Bad 0.40 -15% Please show work and formulas used
You are considering two mutual funds as an investment. The possible returns for the funds are...
You are considering two mutual funds as an investment. The possible returns for the funds are dependent on the state of the economy and are given in the accompanying table. State of the Fund Fund Economy 1 2 Good 42% 43% Fair 16% 22% Poor -18% -12% You believe that the likelihood is 13% that the economy will be good, 55% that it will be fair, and 32% that it will be poor. a. Find the expected value and the...
2. The returns of two stocks and one bond in 4 possible states of economies are...
2. The returns of two stocks and one bond in 4 possible states of economies are given below. Probability Stock A Stock B Bond C Recession 10% -25% -10% 5% Normal-bad 30% -5% 1% 5% Normal-good 40% 10% 6% 3% Boom 20% 30% 9% 1% (1) What is expected return and the standard deviation of the three assets? (2) What are the pairwise correlations among the 3 assets (i.e., PA " A .- 400 mt nl A 20% stock Band...
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of a 12% return; a 50% probability of a 16% return; and a 30% probability of a 19% return. What is the standard deviation of return for this investment? A) 5.89% B) 16.1% C) 2.43% D) 15.7% 6. Answer the questions below using the following information on stocks A, B, and C. Expected Return Standard Deviation Beta 20% 12% 1.8 21% 10% 2.2 10% 10%...
Problem 8-05 Two investments generated the following annual returns: Investment x 13% Investment Y 24% 22 19 20x0 20X1 20x2 20x3 20X4 16 a. What is the average annual return on each investment? Round your answers to one decimal place. The average annual rate of return on X: The average annual rate of return on Y: b. What is the standard deviation of the return on investments X and Y? Round your answers to two decimal places. Standard deviation of...
Problem 8-05 Two investments generated the following annual returns: Investment X Investment Y 20x0 13% 17 % 20X1 24 20X2 18 20x3 14 20X4 12 a. What is the average annual return on each investment? Round your answers to one decimal place. The average annual rate of return on X: % The average annual rate of return on Y: b. What is the standard deviation of the return on investments X and Y? Round your answers to two decimal places....
12) Assume that an investment is forecasted to produce the following returns: a 30% probability of a what is the 12% return; a 50% probability of a 16% return; and a 20% probability of a 19% return. expected percentage return this investment will produce? A) 16.1% B) 15.4% C) 33.3% D) 9.5%
Portfolio Security Stock A Stock B Stock C Return 11% 16% 25% Probability 20% 30% 50% (1) (ii) Find its expected return of the portfolio. Find the standard deviation of the portfolio. [2 marks] (5 marks]
You are considering two mutual funds as an investment. The possible returns for the funds are dependent on the state of the economy and are given in the accompanying table. State of the Fund Fund Economy 1 2 Good 42% 43% Fair 16% 22% Poor -18% -12% You believe that the likelihood is 13% that the economy will be good, 55% that it will be fair, and 32% that it will be poor. a. Find the expected value and the...
2. The returns of two stocks and one bond in 4 possible states of economies are given below. Probability Stock A Stock B Bond C Recession 10% -25% -10% 5% Normal-bad 30% -5% 1% 5% Normal-good 40% 10% 6% 3% Boom 20% 30% 9% 1% (1) What is expected return and the standard deviation of the three assets? (2) What are the pairwise correlations among the 3 assets (i.e., PA " A .- 400 mt nl A 20% stock Band...
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