You have an investment with the following history of returns: 3. 30 -10%a 201 50 25%a 6C 40 80 -22%a 19%a 43%aa 26%a 10%a 13%a You believe that the history ofreturns for this investment is a good indication ofwhat to expect going forward. What is the expected return, standard deviation of returns, and 95% confidence interval for this investment?T
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- APT An analyst has modeled the stock of Crisp Trucking using a two-factor APT model. The risk-free rate is 6%, the expected return on the first factor (r1) is 12%, and the expected return on the second factor (r2) is 8%. If bi1 = 0.7 and bi2 = 0.9, what is Crisp’s required return?Assume that an investment is forecasted to produce the following returns: a 20% probability of a 12% return; a 50% probability of a 16% return; and a 30% probability of a 19% return What is the standard deviation of return for this investment? A) 5.89% B) 16.1% C) 2.43% D) 15.7%For investment A, the probability of the return being 20.0% is 0.5, 10.0% is 0.4, and -10.0% is 0.1 Compute the standard deviation for the investment with the given information. (Round your answer to one decimal place.) a. 85.00% b. 15.00% c. 34.00% d. 17.00% e. 9.00%
- Consider the following information State Probability X Y Boom .25 15% 10% Normal .60 10% 9% Recession .15 5% 10% What is the standard deviation for a portfolio with an investment of $6000 in asset X and $4000 in asset Y?Given an expected return of 8% and a standard deviation of 9%, we can predict that there is a _____ chance that future returns for this investment will fall between the range of -19% and 35%. Select one: a. 99.7% b. 95% c. 68% d. Unable to predictConsider a position consisting of a K200,000 investment in Asset A and a K300,000 investment in Asset B. Assume that the daily volatilities of the assets are 1.5% and 1.8% respectively, and that the coefficient of correlation between their returns is 0.4. What is the five day 95% Value at Risk (VaR) for the portfolio (95% confidence level represents 1.65 standard deviations on the left side of a normal distribution)?
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