ou are an active investor in the securities market and you have established an investment portfolio of two stock A and B five years ago. Required: Assume that you bought 200 stock B in your portfolio for total investment of $1200, now the market price of the stock is $75, the dividend paid for this stock is $2 each year. How much is the capital gain of this stock ? Assume that the following data available for the portfolio, calculate the expected return, variance and standard deviation of the portfolio given stock A accounts for 45% and stock B accounts for 55% of your portfolio? A B Expected return 12.5% 18.5% Standard Deviation of return 15% 20% Correlation of coefficient (p) 0.4
ou are an active investor in the securities market and you have established an investment portfolio of two stock A and B five years ago. Required: Assume that you bought 200 stock B in your portfolio for total investment of $1200, now the market price of the stock is $75, the dividend paid for this stock is $2 each year. How much is the capital gain of this stock ? Assume that the following data available for the portfolio, calculate the expected return, variance and standard deviation of the portfolio given stock A accounts for 45% and stock B accounts for 55% of your portfolio? A B Expected return 12.5% 18.5% Standard Deviation of return 15% 20% Correlation of coefficient (p) 0.4
Chapter8: Analysis Of Risk And Return
Section: Chapter Questions
Problem 5P
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Question
You are an active investor in the securities market and you have established an investment portfolio of two stock A and B five years ago.
Required:
- Assume that you bought 200 stock B in your portfolio for total investment of $1200, now the market price of the stock is $75, the dividend paid for this stock is $2 each year. How much is the
capital gain of this stock ? - Assume that the following data available for the portfolio, calculate the expected return, variance and standard deviation of the portfolio given stock A accounts for 45% and stock B accounts for 55% of your portfolio?
|
|
A |
B |
|
Expected return |
12.5% |
18.5% |
|
Standard Deviation of return |
15% |
20% |
|
Correlation of coefficient (p) |
0.4 |
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