Scholarship with Prafessionalism Review Question 1 • Cronox Industries and Zealous Incorporated share prices and dividends are shown below for the period 1995 – 2000. Cronox Industries Zealous Incorporated Year Stock price Dividend (GHe) Stock price Dividend(GHe) 2010 7.62 0.85 55.75 2.00 2011 12 0.90 60.00 2.25 2012 10.75 0.95 57.25 2.50 2013 17 1.00 48.75 2.75 2014 15.75 1.06 52.30 2.90 2015 17.25 1.15 48.75 3.00 UPSA Scholarship with Professionaliam Review Question 1 Use the data given to calculate annual returns for Cronox, and Zealous.

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Scholarship with Professionalism
Review Question 1
• Cronox Industries and Zealous Incorporated share
prices and dividends are shown below for the
period 1995 – 2000.
Cronox Industries
Zealous Incorporated
Year
Stock price
Dividend (GHe)
Stock price
Dividend(GHe)
2010
7.62
0.85
55.75
2.00
2011
12
0.90
60,00
2.25
2012
10.75
0.95
57.25
2.50
2013
17
1.00
48.75
2.75
2014
15.75
1.06
52.30
2.90
2015
17.25
1.15
48.75
3,00
UPSA
Scholarship with Professionalism
Review Question 1
Use the data given to calculate annual returns for Cronox, and Zealous.
Compute average return (Arithmetic Average) over the five year period
(2006-2010)
Calculate the risk (standard deviation of returns) for both Cronox and
Zealous.
Calculate the coefficient of variation for both companies
Compare the two companies in terms of risk and returns.
Calculate the correlation coefficient between the two stock
Calculate the portfolio risk and return assuming the assets are equally
weighted.
Assuming Kweku invested GH¢20,000 in the stocks of Cronox Industries
and GH¢30,000 in that of Zealous Incorporated with a correlation
coefficient between the two firms of 0.8, what is the portfolio risk and
return?
Transcribed Image Text:Scholarship with Professionalism Review Question 1 • Cronox Industries and Zealous Incorporated share prices and dividends are shown below for the period 1995 – 2000. Cronox Industries Zealous Incorporated Year Stock price Dividend (GHe) Stock price Dividend(GHe) 2010 7.62 0.85 55.75 2.00 2011 12 0.90 60,00 2.25 2012 10.75 0.95 57.25 2.50 2013 17 1.00 48.75 2.75 2014 15.75 1.06 52.30 2.90 2015 17.25 1.15 48.75 3,00 UPSA Scholarship with Professionalism Review Question 1 Use the data given to calculate annual returns for Cronox, and Zealous. Compute average return (Arithmetic Average) over the five year period (2006-2010) Calculate the risk (standard deviation of returns) for both Cronox and Zealous. Calculate the coefficient of variation for both companies Compare the two companies in terms of risk and returns. Calculate the correlation coefficient between the two stock Calculate the portfolio risk and return assuming the assets are equally weighted. Assuming Kweku invested GH¢20,000 in the stocks of Cronox Industries and GH¢30,000 in that of Zealous Incorporated with a correlation coefficient between the two firms of 0.8, what is the portfolio risk and return?
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