What would you recommend, as far as trading, when the short- term (say 5-day) moving average moves above the long-term (say 10-day) moving average.
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- What is the (exact) nominal return on an investment that earns a real return of 14.7% while inflation is 7.4%? Enter your response, in percent (%), correct to TWO decimal places.If the average range of the market’s return (as measured by the S&P 500) is +/- 9% for a given period, and X-Co’s Beta is 1.4, what is its expected range for that period?What is the mean return for trading days other than first day of the month?
- A company has a beta of 1.4, the T-bill rate is 2.09%, and the expected return on the market is 9.02%. What is its required rate of return? Do not round your intermediate calculations. Express as a percent rounded to two decimal places.(CAPM and expected returns) a. Given the following holding-period returns, LOADING... Month Zemin Corp. Market 1 8 % 5 % 2 5 4 3 0 2 4 −4 −1 5 6 4 6 3 3 , compute the average returns and the standard deviations for the Zemin Corporation and for the market. b. If Zemin's beta is 1.12 and the risk-free rate is 7 percent, what would be an expected return for an investor owning Zemin? (Note: Because the preceding returns are based on monthly data, you will need to annualize the returns to make them comparable with the risk-free rate. For simplicity, you can convert from monthly to yearly returns by multiplying the average monthly returns by 12.) c. How does Zemin's historical average return compare with the return you believe you should expect based on the capital asset pricing model and the firm's systematic risk? Question content area…The Markets average historical excess return is closet to (%) (2 decimal places):
- Show the monthly return of the company and S&P 500 in the same graph. What is your interruption interpretation of the change of return of the company comparing with the market index? Calculate the monthly standard deviation and return for both the company and S&P 500. What is your interruption of the risk and return of the company comparing with the market index? S&P 500 last 6 months : Date Open High Low Close* Adj. close** Volume 01 Apr 2022 4,540.32 4,593.45 4,381.34 4,392.59 4,392.59 37,024,560,000 01 Mar 2022 4,363.14 4,637.30 4,157.87 4,530.41 4,530.41 100,978,320,000 01 Feb 2022 4,519.57 4,595.31 4,114.65 4,373.94 4,373.94 73,167,790,000 01 Jan 2022 4,778.14 4,818.62 4,222.62 4,515.55 4,515.55 73,279,440,000 01 Dec 2021 4,602.82 4,808.93 4,495.12 4,766.18 4,766.18 68,699,830,000…You believe that the VIX trades in regimes where its average level is significantly different. You define four regimes from 2004 through 2021 June 2008 through October 2011 (financial crisis): February 2020 through March 2021 (the COVID-19 crisin); the 12-month transition periods before and after the financial crisis and the current transition period after the COVID-19 crisis and the remaining periods of low volatility. In order to test your hypothesis, you examine month-end values of the VIX from January 2004 through October 2021 (214 observations) and conduct the following regression: Dependent variable Y Month-end value of VIX Dummy variable X1 Financial Crisis 1 if between June 2008 through Oct 2011,0 if not Dummy variable X2.COVID-19 crisis: 1 if between Feb 2020 through March 2021, Dummy variable X2 Transition period 1 if in 12 months before or after the financial crisis orthe current period since the COVID-19 crisis (June 2007 May 2008, Nov 2011-Oct 2012 or April 2021-Oct…If the annual geometric mean for the equity risk premium is 8.4 percent, what percentage of the equity risk premium is consumed by trading costs of 1.2 percent?
- Calculate the annual arithmetic mean and geometric mean return on the following security, purchase price: $42; first-year dividend - $4; price after one year - $47; second-year dividend - $4; selling price after two years = $40. (Round intermediate calculations to 3 decimal places, eg. 15.251% and the final answers to 2 decimal places, e.g. 15.25%.) 1) Find arithmetic average return % 2) Find Geometric mean return % 3) State which method is more appropriate for the situationDetermine the value of a putnoption using the following information risk free rate = 6%Time of matury = 3 monthscall price = 5s stock price = 30 strike price = 28For the upcoming year, the risk-free rate is 2 percent, and the expected return to the market is 7 percent. You are also given the following covariance matrix for Securities J,K, andL. \table[[Covariance,Security J,Security K,Security L],[Security J,0.0012532,0.0010344,0.0019711],[Security K,0.0010344,0.0023717,0.0013558],[Security L,0.0019711,0.0013558,0.0048442]] Also assume that you form a portfolio by putting 0 percent of your funds in Security J, 40 percent of your funds in Security K, and 60 percent of your funds in Security L. Based on this information, determine the standard deviation of the resulting portfolio. ◻ 6.47% 5.27% 4.98% 5.82% 4.77%