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Which of the following portiolios would be off the efficient frontier? Poolc Expected Return 13% 12...
Portfolio analvsis (8 points L3 points) Asset A has an expected return of 10% and a...
Portfolio analvsis (8 points L3 points) Asset A has an expected return of 10% and a Sharpe ratio of 0.4. Asset B bas ans expectod retum of 15% and a Sharpe ratio of o3. Asset C has an expected return of 20% and a Sharpe ratio of 0.35. A risk-averse investor would prefer to build a complete portfolio using the risk free asset and a Asset A b. Asset B c Asset C d. No risky asset 2 (3 points)...
22. Which of the following statements about the efficient frontier is least accurate? A. Portfolios falling...
22. Which of the following statements about the efficient frontier is least accurate? A. Portfolios falling on the efficient frontier are fully diversified. B. Investors will want to invest in the portfolio on the efficient frontier that offers the highest rate of return. C. The efficient frontier shows the relationship that exists between expected return and total risk in the absence of a risk-free asset.
All of the following feasible risk-return combinations lie on the efficient frontier except one. Identify the...
All of the following feasible risk-return combinations lie on the efficient frontier except one. Identify the one feasible risk-return combination that could not possibly be on the efficient frontier with the other ones? Group of answer choices a. return =.14 ; standard deviation = .16 b. return =.22 ; standard deviation = .45 c. return =.06 ; standard deviation = .14 d. return =.12 ; standard deviation = .16
Q7-Consider the following combination of expected return and risk for various portfolios (named A-H) on the...
Q7-Consider the following combination of expected return and risk for various portfolios (named A-H) on the risk-return diagram. Assume a risk-free rate of 12% where one may borrow or lend at this rate. Expected Return (%) Risk (%) A 10 23 B 12.5 21 C D E F G H 15 16 17 18 18 20 25 29 29 32 35 45 Sharpe Ratio 1. Which of the above portfolios has the highest Sharpe ratio? (Must express in percentage) (5pts.)...
Suppose that youu currently have $250,000 invested in a portfolio with an expected return of 12%...
Suppose that youu currently have $250,000 invested in a portfolio with an expected return of 12% and a volatility of 10%. the efficient (tangent) portfolio has an expected return of 17% and a volatility of 12%. the risk-free rate of interest is 5%. the sharpe ratio for the efficient portfolio is closest to: a) 1,0 b) 1,4 c) 0,7 d) 1,2
Correlation, risk, and return Matt Peters wishes to evaluate the risk and return behaviors associated with...
Correlation, risk, and return Matt Peters wishes to evaluate the risk and return behaviors associated with various combinations of assets V and W under three assumed degrees of correlation: perfectly positive, uncorrelated, and perfectly negative. The expected return and risk values calculated for each of the assets are shown in the following table, B a. If the returns of assets V and W are perfectly positively correlated correlation coefficient = +1), describe the range of (1) expected return and (2)...
4. Investor equilibrium The following graph shows the set of portfolio opportunities for a multiasset case....
4. Investor equilibrium The following graph shows the set of portfolio opportunities for a multiasset case. The point RF corresponds to a risk-free asset, the red curve BME is the efficient frontier, the shaded area under the efficient frontier represents the feasible set of portfolios of risky assets, and the yellow curves II and I2 are indifference curves for a particular investor. EXPECTED RATE OF RETURN (Percent) 10 RISK (Portfolio's standard deviation) The points on the line PRF MZ represent:...
answer all. For the next question, assume an investor with the following utility function U-E)-3/2) 12. To maximize her expected uility, she would choose the set with an espect rate of return of...
answer all.
For the next question, assume an investor with the following utility function U-E)-3/2) 12. To maximize her expected uility, she would choose the set with an espect rate of return of and a standard deviation ofrspectively A. 1296; 20% B. 10%; 15% C. 1056; 1056 D, 8%, 10% Е.none ofthe above 13. Which of the following statements regarding the Capital Allocation Line (CAL) false? A. The CAL shows risk-return combinations. B. The slope of the CAL equals the...
please answer The following graph represents the relationship between the efficient set of possible portfolios and...
please answer
The following graph represents the relationship between the efficient set of possible portfolios and various investors EXPECTED RATE OF RETURN (Percent) 10 Investor Green Investor Blue Efficient Frontier 10 RISK (Portfolio's standard deviation) Assuming that the black line represents the efficient frontier, which of the following best describes portfolios that lie to the right of this ine? On the preceding graph, the green and blue lines represent the indifference curves of two investors, investor Green and investor Blue....
efficient fronteir and portfolio choice
Problem 5 (Efficient frontier and portfolio choice)Consider the following expected returns, volatilities, and correlations:StockExpected returnStandard deviationCorrelation with Duke EnergyCorrelation with MicrosoftCorrelation with Wal-MartDuke Energy14%6%1-10Microsoft44%24%-110.7Wal-Mart23%14%00.71(a) Consider a portfolio consisting of only Duke Energy and Microsoft. The percentage of your investment (portfolio weights) that you would place in Microsoftstock to achieve a risk-free investment should be closest to:(1) 15%(2) 4%(3) 23%(4) 10%(b) The expected return of a portfolio that is equally-invested in Duke Energy and Microsoft is closest to:(1) 28%(2) 29%(3) 24%(4)...
Portfolio analvsis (8 points L3 points) Asset A has an expected return of 10% and a Sharpe ratio of 0.4. Asset B bas ans expectod retum of 15% and a Sharpe ratio of o3. Asset C has an expected return of 20% and a Sharpe ratio of 0.35. A risk-averse investor would prefer to build a complete portfolio using the risk free asset and a Asset A b. Asset B c Asset C d. No risky asset 2 (3 points)...
22. Which of the following statements about the efficient frontier is least accurate? A. Portfolios falling on the efficient frontier are fully diversified. B. Investors will want to invest in the portfolio on the efficient frontier that offers the highest rate of return. C. The efficient frontier shows the relationship that exists between expected return and total risk in the absence of a risk-free asset.
Q7-Consider the following combination of expected return and risk for various portfolios (named A-H) on the risk-return diagram. Assume a risk-free rate of 12% where one may borrow or lend at this rate. Expected Return (%) Risk (%) A 10 23 B 12.5 21 C D E F G H 15 16 17 18 18 20 25 29 29 32 35 45 Sharpe Ratio 1. Which of the above portfolios has the highest Sharpe ratio? (Must express in percentage) (5pts.)...
Correlation, risk, and return Matt Peters wishes to evaluate the risk and return behaviors associated with various combinations of assets V and W under three assumed degrees of correlation: perfectly positive, uncorrelated, and perfectly negative. The expected return and risk values calculated for each of the assets are shown in the following table, B a. If the returns of assets V and W are perfectly positively correlated correlation coefficient = +1), describe the range of (1) expected return and (2)...
4. Investor equilibrium The following graph shows the set of portfolio opportunities for a multiasset case. The point RF corresponds to a risk-free asset, the red curve BME is the efficient frontier, the shaded area under the efficient frontier represents the feasible set of portfolios of risky assets, and the yellow curves II and I2 are indifference curves for a particular investor. EXPECTED RATE OF RETURN (Percent) 10 RISK (Portfolio's standard deviation) The points on the line PRF MZ represent:...
answer all.
For the next question, assume an investor with the following utility function U-E)-3/2) 12. To maximize her expected uility, she would choose the set with an espect rate of return of and a standard deviation ofrspectively A. 1296; 20% B. 10%; 15% C. 1056; 1056 D, 8%, 10% Е.none ofthe above 13. Which of the following statements regarding the Capital Allocation Line (CAL) false? A. The CAL shows risk-return combinations. B. The slope of the CAL equals the...
please answer
The following graph represents the relationship between the efficient set of possible portfolios and various investors EXPECTED RATE OF RETURN (Percent) 10 Investor Green Investor Blue Efficient Frontier 10 RISK (Portfolio's standard deviation) Assuming that the black line represents the efficient frontier, which of the following best describes portfolios that lie to the right of this ine? On the preceding graph, the green and blue lines represent the indifference curves of two investors, investor Green and investor Blue....
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