Debt has expected return of 8% and standard deviation of 12%. Equity has expected return of...
Debt has expected return of 8% and standard deviation of 12%. Equity has expected return of 13% and standard deviation of 20%. The covariance between debt and equity is 0.0072. You have a portfolio that invests equally in debt and equity. What is the standard deviation of your portfolios?
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Debt has expected return of 8% and standard deviation of 12%.
Equity has expected return of...
8) The EQT Equity Fund has an expected return Eſr) of 14.190% and a standard deviation...
8) The EQT Equity Fund has an expected return Eſr) of 14.190% and a standard deviation o of 20%. The ZQR Bond Fund has and expected return E[r] of 7.510% and a standard deviation o of 10%. The correlation coefficient (p) is -0.12. A portfolio comprised of 69% EQT and 31% ZQR would have on of 20%. The Zar. Bond Fund has and expected returned an expected return of and a standard deviation of
You have a portfolio with a standard deviation of 26 % and an expected return of...
You have a portfolio with a standard deviation of 26 % and an expected return of 17 %. You are considering adding one of the two stocks in the following table. If after adding the stock you will have 20 % of your money in the new stock and 80 % of your money in your existing portfolio, which one should you add? Expected Return Standard Deviation Correlation with your portfolios return Stock A 13% 25% 0.3...
3. Consider Table 3 Table 3 Stock Expected Return 10% 5% Standard Deviation 12% 8% Correlation...
3. Consider Table 3 Table 3 Stock Expected Return 10% 5% Standard Deviation 12% 8% Correlation Coefficient 0.40 (a) Consider Table 3. Compute the expected return and standard deviation of return of an equally-weighted portfolio of stocks A and B (b) Consider Table 3. Solve for the composition, expected return and standard deviation of the minimum variance portfolio (c) Consider Table 3. Sketch the set of portfolios comprised of stocks A and B (d) Consider Table 3. Suppose that a...
Stock A’s expected return and standard deviation are E[rA] = 8% and σA= 15%, while stock...
Stock A’s expected return and standard deviation are E[rA] = 8% and σA= 15%, while stock B’s expected return and standard deviation are E[rB] = 12% and σB= 21%.  a. Determine the expected return and standard deviation of the return on a portfolio with weights wA=.35 and wB=.65 for the following alternative values of correlation between A and B: pAB=0.6 and pAB= -0.4. b. Assume now that pAB=-1.0 and find the portfolio p of stocks A and B that...
3. Consider Table 2. Table 2 Stock Expected Return 2 12% 6% Standard Deviation 20% 10%...
3. Consider Table 2. Table 2 Stock Expected Return 2 12% 6% Standard Deviation 20% 10% 0.20 Correlation Coefficient (a) Consider Table 2. Compute the expected return and standard deviation of return of an equally-weighted (b) Consider Table 2. Solve for the composition, expected return and standard deviation of the minimum (c) Consider Table 2. Sketch the set of portfolios comprised of stocks 1 and 2. Be sure to include the portfolios (d) Consider Table 2. Suppose that a risk-free...
Expected Return Standard Deviation Portfolio A 12% 20% Portfolio B 6% 12% T...
Expected Return Standard Deviation Portfolio A 12% 20% Portfolio B 6% 12% T-bill 3% 0% You are an investment adviser and you have the three investments above to recommend to your clients. The correlation between A and B is -0.5. Solve for the optimal risky portfolio and enter the weights as a %, 99% should be entered as 99.00%. Percent invested in Portfolio A Percent invested in Portfolio B What is the standard deviation of the optimal risky portfolio? What...
Stocks A and B each have an expected return of 15%, a standard deviation of 17%,...
Stocks A and B each have an expected return of 15%, a standard deviation of 17%, and a beta of 1.2. The returns on the two stocks have a correlation coefficient of <1.0. You have a portfolio that consists A) The portfolio's beta is less than 12. B) The portfolio's standard deviation is greater than 17%. C) The portfolio's standard deviation is less than 17%. D) The portfolio's expected return is 15%.
Consider the following scenario seen in class Expected Return 8% Standard Dev. Debt Fund 12% Equity...
Consider the following scenario seen in class Expected Return 8% Standard Dev. Debt Fund 12% Equity Fund Risk-Free 13% 20% 5% Correlation 0.1 Risk Aversion (A) 2 Omega D 0 % MV Utility Omega E Standard Deviation Sharpe Ratio Expected Return 100% 13.00% 20.00% 0.400 9.00% 5% 95% 12.75% 19.07% 0.406 9.11% 10% 90% 12.50% 18.16% 0.413 9.20% 12.25% 17.27 % 15% 85% 0.420 9.27% 80% 16,41% 0.426 9.31% 20% 12.00% 25% 75% 11.75% 15.59% 0.433 9.32% 30% 70% 11.50%...
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...
22. Security C has expected return of 12% and standard deviation of 20%. Security D has...
22. Security C has expected return of 12% and standard deviation of 20%. Security D has expected return of 15% and standard deviation of 27%. If the two securities have a correlation coefficient of 0.7, what is their covariance? 0.038 а. b. 0.070 0.018 с. d. 0.013 0.054 е.
8) The EQT Equity Fund has an expected return Eſr) of 14.190% and a standard deviation o of 20%. The ZQR Bond Fund has and expected return E[r] of 7.510% and a standard deviation o of 10%. The correlation coefficient (p) is -0.12. A portfolio comprised of 69% EQT and 31% ZQR would have on of 20%. The Zar. Bond Fund has and expected returned an expected return of and a standard deviation of
3. Consider Table 3 Table 3 Stock Expected Return 10% 5% Standard Deviation 12% 8% Correlation Coefficient 0.40 (a) Consider Table 3. Compute the expected return and standard deviation of return of an equally-weighted portfolio of stocks A and B (b) Consider Table 3. Solve for the composition, expected return and standard deviation of the minimum variance portfolio (c) Consider Table 3. Sketch the set of portfolios comprised of stocks A and B (d) Consider Table 3. Suppose that a...
3. Consider Table 2. Table 2 Stock Expected Return 2 12% 6% Standard Deviation 20% 10% 0.20 Correlation Coefficient (a) Consider Table 2. Compute the expected return and standard deviation of return of an equally-weighted (b) Consider Table 2. Solve for the composition, expected return and standard deviation of the minimum (c) Consider Table 2. Sketch the set of portfolios comprised of stocks 1 and 2. Be sure to include the portfolios (d) Consider Table 2. Suppose that a risk-free...
Stocks A and B each have an expected return of 15%, a standard deviation of 17%, and a beta of 1.2. The returns on the two stocks have a correlation coefficient of <1.0. You have a portfolio that consists A) The portfolio's beta is less than 12. B) The portfolio's standard deviation is greater than 17%. C) The portfolio's standard deviation is less than 17%. D) The portfolio's expected return is 15%.
Consider the following scenario seen in class Expected Return 8% Standard Dev. Debt Fund 12% Equity Fund Risk-Free 13% 20% 5% Correlation 0.1 Risk Aversion (A) 2 Omega D 0 % MV Utility Omega E Standard Deviation Sharpe Ratio Expected Return 100% 13.00% 20.00% 0.400 9.00% 5% 95% 12.75% 19.07% 0.406 9.11% 10% 90% 12.50% 18.16% 0.413 9.20% 12.25% 17.27 % 15% 85% 0.420 9.27% 80% 16,41% 0.426 9.31% 20% 12.00% 25% 75% 11.75% 15.59% 0.433 9.32% 30% 70% 11.50%...
22. Security C has expected return of 12% and standard deviation of 20%. Security D has expected return of 15% and standard deviation of 27%. If the two securities have a correlation coefficient of 0.7, what is their covariance? 0.038 а. b. 0.070 0.018 с. d. 0.013 0.054 е.
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