The following three defense stocks are to be combined into a stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance):
Price | ||||||||||
Shares (millions) |
1/1/16 | 1/1/17 | 1/1/18 | |||||||
Douglas McDonnell | 195 | $ | 97 | $ | 100 | $ | 113 | |||
Dynamics General | 455 | 27 | 22 | 36 | ||||||
International Rockwell | 230 | 56 | 45 | 62 | ||||||
a. Calculate the initial value of the index if a price-weighting scheme is used.
b. What is the rate of return on this index for the year ending December 31, 2016? For the year ending December 31, 2017? (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)
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The following three defense stocks are to be combined into a stock index in January 2016...
QUESTION 2 The following three defense stocks are to be combined into a stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance). Assume the index is scaled by a factor of 10 million, that is, if the total value of all firms in the market is $5 billion, the index would be quoted as 500. Price Douglas McDonnell Dynamics General International Rockwell Shares (millions) 195 455 230 1/1/16...
QUESTION 4 The following three defense stocks are to be combined into a price-weighted stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance): Suppose that Douglas McDonnell shareholders approve a 3-for-1 stock split on January 1, 2017 and that the company enacts the stock split on January 2, 2017 Price Shares (millions) 1/1/16 1/1/17 1/1/18 Douglas McDonnell 195 $ 97 $100 $35.39 Dynamics General 455 22 36 International...
The following three defense stocks are to be combined into a stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance). Assume the index is scaled by a factor of 10 million; that is, if the total value of all firms in the market is $5 billion, the index would be quoted as 500. Price Shares (millions) 1/1/16 1/1/17 1/1/18 Douglas McDonnell 350 $ 65 $ 69 $ 81...
QUESTION 3 The following three defense stocks are to be combined into a stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance) Price Shares 1/1/16 $ 64 1/1/17 $ 68 Douglas McDonnell Dynamics General International Rockwell 215 455 250 72 64 1/1/18 $ 82 78 1 06 101 90 a. Calculate the initial value of the index if a price-weighting scheme is used. (Enter your answers rounded to...
The following three defense stocks are to be combined into a stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance). Assume the index is scaled by a factor of 10 million; that is, if the total value of all firms in the market is $5 billion, the index would be quoted as 500. Price Shares (millions) 1/1/16 1/1/17 1/1/18 Douglas McDonnell 425 $ 72 $ 75 $ 92...
The following three defense stocks are to be combined into a stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance): Suppose that Douglas McDonnell shareholders approve a 3-for-1 stock split on January 1, 2017. Price Shares (millions) 1/1/16 1/1/17 1/1/18 Douglas McDonnell 545 $ 80 $ 83 $ 98 Dynamics General 460 70 63 77 International Rockwell 190 99 88 91 a. What is the new divisor for...
Problem 5-14 Price-Weighted Indexes (L04, CFA2) The following three defense stocks are to be combined into a stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance): Price Shares (millions) 530 230 330 1/1/16 $ 62 1/1/18 $ 81 Douglas McDonnell Dynamics General International Rockwell - 34 1/1/17 $ 66 28 52 42 63 68 ces a. Calculate the initial value of the index if a price-weighting scheme is...
Problem 5-16 Value-Weighted Indexes (LO4, CFA2) The following three defense stocks are to be combined into a stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance). Assume the index is scaled by a factor of 10 million; that is, if the total value of all firms in the market is $5 billion, the index would be quoted as 500. Price Douglas McDonnell Dynamics General International Rockwell Shares (millions)...
Problem 5-16 Value-Weighted Indexes (LO4, CFA2) The following three defense stocks are to be combined into a stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance). Assume the index is scaled by a factor of 10 million; that is, if the total value of all firms in the market is $5 billion, the index would be quoted as 500. Price Shares (millions) 1/1/16 1/1/17 1/1/18 Douglas McDonnell 530...
The following three defense stocks are to be combined into a price-weighted stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance): Suppose that Douglas McDonnell shareholders approve a 3-for-1 stock split on January 1, 2017 and that the company enacts the stock split on January 2, 2017. Price Shares (millions) 1/1/16 1/1/17 1/1/18 Douglas McDonnell 430 $ 108 $ 114 $ 41.08 Dynamics General 535 38 34 48...