True or false: The standard deviation of the portfolio is always equal to the weighted average of the standard deviations of the assets in the portfolio.
Q: Which of the following measures reflects the excess return earned on a portfolio per unit of its…
A: Treynor's measure is the measure of excess return earned per unit of beta of portfolio. Treynor…
Q: What is the expected return on a two asset portfolio and what are its variance and standard…
A: Two Asset portfolio: The portfolio that has 2 assets is called as two asset portfolio.
Q: The benefits of portfolio diversification are highest when the individual securities within the…
A: Explanation: A diversified portfolio provides the highest benefits when the securities are largely…
Q: Portfolio standard deviation is negatively associated with the covariance among the assets in the…
A: The portfolio standard deviation is the financial measure which computes the investment risk and…
Q: What is the total risk of portfolio as per Sharpe's Single Index Model if standard deviation of…
A: Total Risk = Systematic Risk + Unsystematic risk Systematic Risk = Beta 2 * SD of Market2 = (1.27)2…
Q: What is the systematic risk for a portfolio with two-thirds of the funds invested in X and one-third…
A: The systematic risk of a portfolio is measured by the beta of the portfolio
Q: Portfolio contains of two assets. Asset A has an expected return of 2% and asset B has an expected…
A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…
Q: Which of the following statements is correct? Select one: a. Assuming a correlation…
A: The combination of stock will reduce the overall risk of the portfolio but it it depends on the…
Q: 7. The utility score a typical investor would assign to a particular portfolio, other things equal,…
A: The utility score of an investor depends on return and total risk. The Capital Market Line shows the…
Q: Stock A has a standard deviation of 3.5% while stock B has a standard deviation of 4.6%. If both…
A: Standard deviation is a variation in the mean value of given data. Standard deviation is a…
Q: Which is the best measure of risk for a single asset held in isolation, and which is the best…
A: Answer - Coefficient of variation shall be regarded as the best measure of risk for a single…
Q: What is the standard deviation of the portfolio in part (a) if the citation nescient?
A: Diversified portfolio- It refers to a portfolio of investments in which unsystematic risk or firm…
Q: If a portfolio has a positive investment in every asset, can the beta of the portfolio be less than…
A: Beta of the portfolio is the weighted average of individual asset's betas in the portfolio
Q: Please show full working a. What is the portfolio mean & variance (arithmetic only): i. For an…
A: Given: Date YUM ZTS AAPL Market 31/01/18 84.59 76.73 87.3 1251.42 28/02/18 81.38 80.86 75.74…
Q: In measuring the performance of a portfolio, the time-weighted rate of return is superior to the…
A: Note we have two different type of measurement return of portfolio manager Time weighted rate of…
Q: explain the assertion that the relationship between the standard deviation on a portfolio an the…
A: Answer: The relationship between the standard portfolio deviation and the standard portfolio…
Q: What are the the key concepts (e.g., the standard deviation of the portfolio is less than the…
A: The question is based on the explanation of key concept behind creating a portfolio with different…
Q: The standard deviation of a portfolio Group of answer choices -is not a weighted average of the…
A: The standard deviation of a portfolio is not a weighted average of the standard deviations of the…
Q: d) “The Sharpe ratio is used when the portfolio represents the entire investment fund, while the…
A: The measure of performance generally depends on the role of the portfolio that is to be…
Q: dard deviation of the portfolio return is:
A: Portfolio Standard Deviation is the standard deviation of an investment portfolio's rate of return,…
Q: e) Calculate the portfolio return for each alternative. f) Calculate the portfolio standard…
A: Portfolio return refers to the proportionate return of each investment alternative. The standard…
Q: The following data are available for two assets A and B: E(rA) = 13% E(rB) = 15%…
A: E(rA) = 13% E(rB) = 15% s(rA) = 22% s(rB) = 24% rA,B = 0
Q: Standard deviation of portfolio returns is a measure of ___________. Group of answer choices…
A: Standard deviations of portfolio give the standard deviations of return of portfolio.
Q: Asset 1 has a standard deviation of returns of 0.15 while Asset 2 has a standard deviation of…
A: The covariance of return is product of coefficient of correlation and standard deviations of two…
Q: Portfolio Beta is the average of the Betas of the investments included in the portfolio.
A: Financial management consists of directing, planning, organizing and controlling of financial…
Q: The standard deviation of any portfolio of risky assets is equal to the weighted average of the…
A: Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…
Q: Consider two risky assets that have returns variances of 0.0625 and 0.0324, respectively. The…
A: The provided information are: Return variancesσ12 and σ22 are 0.0625 and 0.0324. Two are equal…
Q: Can the standard deviation of a portfolio be zero? Explain your answer.
A: Standard deviation of a portfolio measures the volatility of returns,i.e. how much the returns…
Q: Portfolio manager wants to optimize the riskiness of the two assets portfolio with the given…
A: Portfolio standard deviation =SQRT((WA*SDA)^2+(WB*SDB)^2+(2*WA*SDA*WB*SDB*Corr(a,b) WA Weight of…
Q: Arrange the following portfolios according to the efficient frontier and identify the portfolio that…
A: The efficient frontier: In the Markowitz portfolio theory, the efficient forntier comprises of all…
Q: In evaluating portfolio return we use the market values at the beginning of the period to compute…
A: A pool of different type of investments is called as portfolio. Return from this total pool of…
Q: Which of the following statement(s) is/ are correct? Select one or more: Portfolio standard…
A: Portfolio is the combination of different securities. Portfolio Standard Deviation is a measure of…
Q: What is a risk measure? a Alpha b Required return on the market portfolio c Standard deviation of…
A: Risk measures are factual measures that are chronicled indicators of speculation hazard and…
Q: Expected returns and standard deviations of three risky assets are as follows: Expected Return…
A: Portfolio is the investment basket where several assets like bonds, securities and real assets like…
Q: Show that the (percent) return of the portfolio satisfies Tp = WATA + WBTB, i.e. the portfolio…
A: The portfolio refers to a combination of different financial securities. Return on the portfolio is…
Q: The measure of risk for a security held in a diversified portfolio is:a. Specific risk.b. Standard…
A: the standard deviation of returns is the measure of risk which measures the dispersion of variables.…
Q: What is the standard deviation of their portfolio?
A: Standard deviation in simple words mean volatility. So the standard deviation of portfolio means the…
Q: The appropriate measure of risk used in Sharpe's measure of portfolio evaluation is a. Range b.…
A:
Q: The concept of Portfolio Effect indicates that the more assets added to the portfolio, the less risk…
A: Portfolio means collection of various financial investments. Such investments can be in mutual…
Q: Calculate the expected return and standard deviation for S and T. (i) Calculate the covariance and…
A: Hai there, thank you for the question. As per company guidelines expert can answer only one question…
Q: The expected rate of return of an investment ________. a. equals one of the possible rates of…
A: Expected or average return is the return calculated by obtaining the mean value of a distribution.…
Q: Which statement is true? Multiple Choice ___ The larger the standard deviation, the lower the…
A: Standard deviation :— Standard Deviations is a basic mathematical concepts that measures volatility…
True or false: The standard deviation of the portfolio is always equal to the weighted average of the standard deviations of the assets in the portfolio.
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 1 images
- The standard deviation of a portfolio is simply the weighted average of the standard deviations for the individual assets within the portfolio. Group of answer choices True Falseexplain the assertion that the relationship between the standard deviation on a portfolio an the standard deviations of the assets in the portfolio is not a simple oneWhat are the the key concepts (e.g., the standard deviation of the portfolio is less than the weighted average of the standard deviations of the stocks in the portfolio)
- What is the standard deviation of the portfolio that invests equally in all three assets M, N, and O?The expected return of a portfolio is simply the weighted average of the expected returns for the individual assets within the portfolio. Group of answer choices True FalseIf a portfolio has a positive investment in every asset, can the standard deviation of the portfolio be less than sum of the individual asset's standard deviations in the portfolio? Explain
- a) Calculate the expected returns for both portfolios b) Calculate the standard deviation for portfolio A.Mean returns for portfolios are calculated by taking the weighted average of the mean returns for each investment in the portfolio. Why won’t this approach work calculate the standard deviation of portfolio returns?Which of the following statements is correct? Select one: a. Assuming a correlation coefficient of 0 between two assets, the portfolio’s standard deviation will be lower than the weighted average of the individual assets’ standard deviation. b. Assuming a correlation coefficient of +1 between two assets, the portfolio’s standard deviation will be lower than the weighted average of the individual assets’ standard deviation. c. Assuming a correlation coefficient of +1 between two assets, the portfolio’s standard deviation will be the same as the weighted average of the individual assets’ standard deviation. d. Both A and C. Clear my choice
- Portfolio standard deviation is negatively associated with the covariance among the assets in the portfolio. Select one: True FalseTrue or false The risk or variability of a well-diversified portfolio mostly reflects the contributions to risk from the standard deviations of the stocks within that portfolioIt is a risk adjusted performance measure that represents the average return on a portfolio. a. sharpe ratio b. Treynor index