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D18 Standard deviation of return Expected return 15% 25% 0.0865 33% 46%...
Q1) A stock fund has an expected return of 15% and a standard deviation of 25%...
Q1) A stock fund has an expected return of 15% and a standard deviation of 25% and a bond fund has an expected return of 10% and a standard deviation of 10%. The correlation between the two funds is 0.25. The risk free rate is 5%. What is the (a) expected return and (b) standard deviation of the portfolio with 70% weight in the stock portfolio and 30% weight in the bond portfolio? Q2) The variance of Stock A is...
Considering the following information of three stocks Stock Expected rate of return Standard deviation ABC 13%...
Considering the following information of three stocks Stock Expected rate of return Standard deviation ABC 13% 20% XYZ 14% 20% MNO 15% 20% The correlation between ABC and XYZ is 0.36 The correlation between ABC and MNO is 0.52 The correlation between XYZ and MNO is 0.68 You decide to invest only in two stocks out of these three stocks. You want to choose a combination of two stocks that will create lower standard deviation. Half of your money will...
Expected Return of Asset 1 = 10% Expected Return of Asset 2 = 15% The standard...
Expected Return of Asset 1 = 10% Expected Return of Asset 2 = 15% The standard deviation of Asset 1's return = The standard deviation of Asset 2's 3% return = 5% The proportion of the capital invested in Asset The proportion of the capital invested in 1 = 30% Asset 2 = 70% Calculate the standard deviation of the portfolio consisting of these two assets when the correlation coefficient between Asset 1 and Asset 2 is 0.40. Select one:...
1. Compute the expected return for a company that will be traded at $100, $120, and $140 next per...
1. Compute the expected return for a company that will be traded at $100, $120, and $140 next period with probabilities 20%, 40%, and 40%, respectively. The price of that company today is $110. 2. Compute the correlation between assets A and B if you know that the standard deviation of B is 50% of the standard deviation of A and the covariance between the two assets is 0.5 times the variance of asset A. 3. What is the risk...
The expected return of the market portfolio is 10% and the standard deviation of the returns...
The expected return of the market portfolio is 10% and the standard deviation of the returns on the market portfolio is 15%. Betas of two stocks are 0.8 and 1.2. The covariance between their returns is approximately Select one: a. 0.0960 b. 0.1440 c. 0.0207 d. 0.0216
Please show work. It can be done in excel if needed. Expected Return Standard Deviation Correlation...
Please show work. It can be done in excel if needed.
Expected Return Standard Deviation Correlation with Stock A Stock A Stock B 20% 25% 0% 10% 15% 5% 0.2 | ТВ If you need an expected return of 12% and you only have the access to the two stocks above (but no access to TB), what is your portfolio composition? What is the standard deviation of your portfolio?
The expected return of Security A is 12 percent with a standard deviation of 15 percent....
The expected return of Security A is 12 percent with a standard deviation of 15 percent. The expected return of Security B is 9 percent with a standard deviation of 10 percent. Securities A and B have a correlation of 0.4. The market return is 11 percent with a standard deviation of 13 percent and the risk-free rate is 4 percent. What is the Sharpe ratio of a portfolio if 35 percent of the portfolio is in Security A and...
49 | Asset 1 has an expected return of 10% and a standard deviation of 20%....
49 | Asset 1 has an expected return of 10% and a standard deviation of 20%. Asset 2 has an expected return of 15% and a standard deviation of 30%. The correlation between the two assets is -1.0. Portfolios of these two assets will have a standard deviation between 0% and 20% between 20% and 30% between 0% and 30% O below 10%
10. What is the expected return and standard deviation of a portfolio comprised of $7,500 in...
10. What is the expected return and standard deviation of a portfolio comprised of $7,500 in stock M and $5000 in stock N and covariance of M and N is 20%? (20 Points) State of Probability of Returns if State Occurs Economy State of Economy Stock M Stock N Boom 10% 18% 10% Normal 75% 7% 8% Recession 15% -20% 6%
Using the following 3 securities calculate: 1. Expected return 2. Variance 3. Standard deviation 4. Correlation...
Using the following 3 securities calculate: 1. Expected return 2. Variance 3. Standard deviation 4. Correlation between all possible pairs 5. Covariance between all possible pairs Probability Stock A .10 .10 .30 .20 .30 5% 5% 12% 6% 18% Stock B 35% 31% 30% 25% 17% Stock C 2% 6% 10% 15% 20%
Considering the following information of three stocks Stock Expected rate of return Standard deviation ABC 13% 20% XYZ 14% 20% MNO 15% 20% The correlation between ABC and XYZ is 0.36 The correlation between ABC and MNO is 0.52 The correlation between XYZ and MNO is 0.68 You decide to invest only in two stocks out of these three stocks. You want to choose a combination of two stocks that will create lower standard deviation. Half of your money will...
Expected Return of Asset 1 = 10% Expected Return of Asset 2 = 15% The standard deviation of Asset 1's return = The standard deviation of Asset 2's 3% return = 5% The proportion of the capital invested in Asset The proportion of the capital invested in 1 = 30% Asset 2 = 70% Calculate the standard deviation of the portfolio consisting of these two assets when the correlation coefficient between Asset 1 and Asset 2 is 0.40. Select one:...
Please show work. It can be done in excel if needed.
Expected Return Standard Deviation Correlation with Stock A Stock A Stock B 20% 25% 0% 10% 15% 5% 0.2 | ТВ If you need an expected return of 12% and you only have the access to the two stocks above (but no access to TB), what is your portfolio composition? What is the standard deviation of your portfolio?
49 | Asset 1 has an expected return of 10% and a standard deviation of 20%. Asset 2 has an expected return of 15% and a standard deviation of 30%. The correlation between the two assets is -1.0. Portfolios of these two assets will have a standard deviation between 0% and 20% between 20% and 30% between 0% and 30% O below 10%
10. What is the expected return and standard deviation of a portfolio comprised of $7,500 in stock M and $5000 in stock N and covariance of M and N is 20%? (20 Points) State of Probability of Returns if State Occurs Economy State of Economy Stock M Stock N Boom 10% 18% 10% Normal 75% 7% 8% Recession 15% -20% 6%
Using the following 3 securities calculate: 1. Expected return 2. Variance 3. Standard deviation 4. Correlation between all possible pairs 5. Covariance between all possible pairs Probability Stock A .10 .10 .30 .20 .30 5% 5% 12% 6% 18% Stock B 35% 31% 30% 25% 17% Stock C 2% 6% 10% 15% 20%
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