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A: $3.00 : $6.00
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A:
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Which of the following measures the total risk of a portfolio?
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- What is a characteristic line? How is this line used to estimate a stocks beta coefficient? Write out and explain the formula that relates total risk, market risk, and diversifiable risk.Explain correlation to your client. Calculate the estimated correlation between Blandy and Gourmange. Does this explain why the portfolio standard deviation was less than Blandys standard deviation?Calculate the correlation coefficient between Blandy and the market. Use this and the previously calculated (or given) standard deviations of Blandy and the market to estimate Blandy’s beta. Does Blandy contribute more or less risk to a well-diversified portfolio than does the average stock? Use the SML to estimate Blandy’s required return.
- Beta is which of the following: A) standard deviation. B) total risk. C) Beta is the relationship which is between an investment's return, and the market return. D) unsystematic risk.Which of the following measures reflects the excess return earned on a portfolio per unit of its systematic risk a. Treynor’s measure b. Sharpe’s measure c. Jensen’s measure d. Total measurea) Calculate the expected returns for both portfolios b) Calculate the standard deviation for portfolio A.
- It is a risk adjusted performance measure that represents the average return on a portfolio. a. sharpe ratio b. Treynor indexThe appropriate measure of risk used in Sharpe's measure of portfolio evaluation is a. Range b. Variance c. Beta d. Standard deviationWhat is a risk measure? a Alpha b Required return on the market portfolio c Standard deviation of historical returns
- The beta of a portfolio is: A. A measure of the correlation of betas of the securities in the portfolio. B. Always greater than one. C. The market value weighted average beta of the securities in the portfolio. D. The geometric average of the beta of the securities in the portfolio.Is the portfolio risk the weighted average of the variance or covariance?The risk premium on the market portfolio will be proportional to _____________ I. the average degree of risk aversion of the investor population. II. the risk of the market portfolio as measured by its variance. III. the risk of the market portfolio as measured by its beta. Group of answer choices a. I only b. II only c. III only d. I and II e. I and III
