Question 5 1 pts Consider the following returns: Stock X Stock Z Year End Stock Y Realized Return Realized Return Realized Return 2004 0.2% 20.1% -14.6% 2005 72.7% -3.2% 4.3% 2006 -27.0% -25.7% -58.1% 2007 56.9% 27.9% 71.1% -5.1% 2008 17.3% 6.7% 2009 -11.3% 17.9% 0.9% The variance on a portfolio that is made up of equal investments in Stock X and Stock Z is closest to: 0.62 0.05 0.12 0.06

Question 5 1 pts Consider the following returns: Stock X Stock Z Year End Stock Y Realized Return Realized Return Realized Return 2004 0.2% 20.1% -14.6% 2005 72.7% -3.2% 4.3% 2006 -27.0% -25.7% -58.1% 2007 56.9% 27.9% 71.1% -5.1% 2008 17.3% 6.7% 2009 -11.3% 17.9% 0.9% The variance on a portfolio that is made up of equal investments in Stock X and Stock Z is closest to: 0.62 0.05 0.12 0.06

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Ch. 11. You own a portfolio that is 25 percent invested in Stock X, 35 percent in Stock Y, and 40 percent in Stock Z. The expected returns on these three stocks are 8 percent, 12 percent, and 17 percent, respectively. What is the expected return on the portfolio? Format as a percent and round to one place past the decimal point as "XX.X"
Q#1: Stocks A and B have the following historical returns:Year Stock Alpha’s Returns Stock Charlie’s Returns2013 18% -14.5%2014 33% 21.8%2015 15% 30.5%2016 -0.5% -7.6%2017 27% 26.3%Required:a. Calculate the average rate of return for each stock during the 5-year period.b. Assume that someone held a portfolio consisting of 60% of Stock…
Problem 13-10 Returns and Standard Deviations [LO1] Consider the following information: State of Economy Probability of State of Economy Rate of Return if State Occurs Stock A Stock B Stock C Boom .15 .37 .47 .27 Good .45 .22 .18 .11 Poor .35 −.04 −.07 −.05 Bust .05 −.18 −.22 −.08 a. Your portfolio is invested 20 percent each in A and C, and 60 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b-1. What is the variance of this portfolio? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., .16161.) b-2. What is the standard deviation? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Q 19) Beangrinder Corp. has an expected rate of return on equity next year (ROE1) equal to 12% and a reinvestment rate next year (RIR1), equal to 50%. Beangrinder Corp.'s equity beta is equal to 1 and the company is expected to have an earnings per share next year (EPS1), equal to $3. The long-run risk-free rate is equal to 1% while the stock market risk premium is forecast to equal 7%. What is Beangrinder Corp.'s intrinsic equity value per share equal to: Options - $100 $25 $50 $75
A3) Finance What is the expected standard deviation of stock A's returns based on the information presented in the table? Outcome Probability of outcome Stock A return in outcome : Good 16% 65.00% Medium 51% 17.00% Bad "?" -35.00%
Problem 7-10Preferred Stock Rate of Return What is the required rate of return on a preferred stock with a $50 par value, a stated annual dividend of 12% of par, and a current market price of (a) $52, (b) $85, (c) $104, and (d) $136 (assume the market is in equilibrium with the required return equal to the expected return)? Round the answers to two decimal places.
Kk.113. what is the expected price per share in 4 years? last dividend per share $4, dividend growth rate 3%, beta for the stock 1.15, risk free rate 5%, market risk premium 8%
Year Cost Market Value Unrealized Gain / (Loss)2020GKKB P25,250 P23,350 (P1,900)ABC 32,450 33,950 1,5002021GKKB P25,250 P24,950 (P300)ABC 32,450 32,650 200 Question 7: The investment in stocks account is overstated or understated by? (Use negative sign if overstated)
Year ASX 300 Index ASX 300 Dividend Yield (%) Return_risky portfolio 2010 4760.79 3.76 - 2011 4052.27 4.93 -0.147788 2012 4626.27 4.33 0.142718 2013 5304.8 3.99 0.147531 2014 5348.93 4.24 0.009118 2015 5249.09 4.72 -0.017783 2016 5617.73 4.09 0.071008 2017 6023.3 4.04 0.072914 2018 5596.96 4.48 -0.070038 2019 6647.74 3.95 0.188447 2020 6574.33 2.82 -0.010619 Average Std.dev 3.86% 10.56% Year Risk free rate (%) Return_risk-free asset 2011 4.51 - 2012 3.11 -0.309484 2013 2.61 -0.163052 2014 2.75 0.055662 2015 2.34 -0.150000 2016 1.78 -0.238503 2017 1.77 -0.005618 2018 2.02 0.141243 2019 0.90 -0.554455 2020 0.02 -0.977778 Average 2.18 -24.47% Calculate: Assuming E(Rc) = 7%, use E(Rc) = Rf + y* (E(Rp) - Rf) 1. % of Risky Assets: 2. % of Risk Free Assets: 3. Standard Deviation of the portfolio
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15 [Question text] Based on the following information, what is the expected return for the following stock? State of Economy Probability of State of Economy Rate of Return if State Occurs Boom 0.06 -6% Normal 0.74 7% Recession 0.20 18% Select one: A. 8.80 percent B. 8.23 percent C. 8.53 percent D. 8.42 percent
Problem 9-21 Risk, Return, and Their Relationship (LG9-3, LG9-4)Consider the following annual returns of Estee Lauder and Lowes Companies: Estee LauderLowes CompaniesYear 123.9%6.0%Year 224.016.6Year 318.14.7Year 450.444.0Year 517.314.0Compute each stocks average return, standard deviation, and coefficient of variation.Note: Round your answers to 2 decimal places.

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