Your portfolio has provided you with returns of 8.6 percent, 14.2 percent, -3.7 percent, and 12.0 percent over the past four years. respectively. What is the geometric average return for this period? a). 7.78%b). 5.99%c). 7.54%

Your portfolio has provided you with returns of 8.6 percent, 14.2 percent, -3.7 percent, and 12.0 percent over the past four years. respectively. What is the geometric average return for this period? a). 7.78%b). 5.99%c). 7.54%

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 13P

See similar textbooks

Related questions

Q: Given six years of percentage return of Stock A and Stock B, identify the expected return, and risk…

A: year stock A stock B 20X1 10% 20% 20X2 -15% -20% 20X3 20% -10% 20X4 25% 30% 20X5 -30% -20%…

Q: You had the following rates of return for on your portfolio for the last four years: 2016: -12.3%…

A: Geometric average mean is calculated by taking the average multiplication of the numbers given.…

Q: Your portfolio has provided you with returns of 8.6 percent, 14.2 percent, -3.7 percent, and 12.0…

A: Geometric average return is a very useful tool which is used by investors to calculate the rate of…

Q: Suppose that the rate of return for a particular stock during the past two years was 10% and 20%.…

A: Geometric Rate of return= [(1+r1)*(1+r2)......(1+r3)1/n-1 r1= .10 r2=.20 n=2 years

Q: Using the data in the following table, Year 2010 2011 2012…

A: Portfolio: A portfolio is a collection of financial assets such as stocks, bonds, commodities, cash…

Q: ver the past 3 years, your stock fund earned returns of 10%, -8%, and 12

A: Solution:- Average annual compound rate means the average of the returns earned in the various…

Q: A portfolio manager creates the following portfolio: Assets Expected Annual Return % Annual Standard…

A: Given:

Q: a) Calculate the average rate of return for each stock during the period 2004 through 2008. Assume…

A: In order to find the average rate of return and standard deviation one can use excel for all these…

Q: David established an investment portfolio of two blue chips four years ago: Gold share and Silver…

A: Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: Which of the two stocks is riskier? Why? Which of the stocks is expected to yield a higher return?…

A: 1) Computation: Step 2 Hence, stock B is riskier than stock A.

Q: You are an experienced investor in the securities market and you have established an investment…

Q: An investment produced annual rates of return of 4%, 8%, 14% and 6%, respectively, over the past…

A: Standard deviation is the best meausre of risk. It meausres dispersion around risk. It can be…

Q: - Calculate the average rate of return for each stock during the period 2x15 through 2x19. Assume…

A: Realized return of a portfolio means that return which is going to be received from the portfolio.…

Q: What is the approximate standard deviation of returns if over the past 4 years an investment…

A: Working note:

Q: A portfolio with a 25% standard deviation generated a return of 15% last year when T-bills were…

A: Given: Standard deviation 25%= 0.25 Average yearly return is 15%= 0.15 And T-bill of 4.5℅= 0.045

Q: David established an investment portfolio of two blue chips four years ago: Gold share and Silver…

A: Note: The geometric returns, the risk-free rate, and the capital gains yield have been computed…

Q: You find a certain stock that had returns of 13.2 percent, –21.6 percent, 27.6 percent, and 18.6…

A: The formula used is shown:

Q: The market portfolio's historical returns for the past three years were 10 percent, 10 percent, and…

A: Average market return = Sum of returns / number of returns Risk free rate of return = 0.04…

Q: The return pattern on your favorite stock has been 5.39%, 8.26%, -12.04%, and 14.27% over the last…

A: In the given question we need to calculate average arithmetic and geometric rates of return from the…

Q: You have a portfolio of three assets at the beginning of the year: Asset 1 is 30% of the portfolio,…

A: The return of portfolio for the year is

Q: Stock A and Stock B have the following historical returns: Year Stock A’s Returns,…

A: Average return is sum of the return to the number of years.…

Q: tock A and Stock B have the following historical returns: Year Stock A’s Returns,…

A: Hi, since there are multiple questions posted, we will answer the first three sub-part questions. If…

Q: Over the past 4 years an investment returned 22%, -5%, -20%, and 9%. What is the standard deviation…

A: Standard Deviation is the deviation of statistical data from its mean. It is the square root of…

Q: What is the standard deviation of the returns of a portfolio that produced returns of -14%, 30%, and…

A: Standard Deviation is the square root of the Square of Deviation from the mean return divided by the…

Q: You find a certain stock that had returns of 15 percent, -22 percent, 23 percent, and 10 percent for…

A: Average return = total return for total period/ total period

Q: Stocks A and B have the following historical returns: Year TA 2006 -18.00% -14.50% 2007 33.00 21.80…

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…

Q: A portfolio of stocks generates a −9% return in 2016, a 23% return in 2017, and a 17% return in…

A: YEAR RETURNS 2016 -9% 2017 23% 2018 17%

Q: If your portfolio has provided you with returns of 9.7%, -6.2%, 12.1%, 11.5% and 13.3% over the past…

A: Geometric average return = [(1+return1)*(1+return2)*(1+return3)*(1+return4)*(1+return5) ^ 1/5] -1

Q: Consider three investments. You are given thefollowing means, standard deviations, and correlations…

A: Portfolio variance is a measurement of risk, of how the aggregate actual returns of a set of…

Q: a. Calculate the expected portfolio return, rp, for each of the 6 years. b. Calculate the expected…

A: “Since you have posted a question with multiple subparts, we will solve first three subparts for…

Q: Below are the annual returns provided by TSCM. Calculate average annual return experienced by an…

Q: During the year just ended, Anna Schultz's portfolio, which has a beta of 0.97, earned a return of…

A: Treynor's Ratio = (Average rate of portfolio-risk free rate)/Beta of the portfolio

Q: You have observed the following returns over time: Stock X…

A: Formulas:

Q: You are an experienced investor in the securities market and you have established an investment…

Q: Suppose the next month rate of return on a portfolio (worth $1M) is distributed as follows. Return…

A: Using excel

Q: Data are given as follows: (all the values are in percent) Month Average portfolio return market…

A: Sharpe ratio: It is a measure of the excess return earned to compensate for the volatility of…

Q: An investment portfolio has equal proportions invested in five stocks. The expected returns and…

A: Investment portfolio : No. of stocks : 5 Weights : equal or 100%/5 = 20% or 0.2 for each stock…

Q: Consider an equal-weighted portfolio that comprises two assets: A and B. The monthly returns for…

A: To Find: X

Q: portfolio had a Sharpe measure of ___

A: The risk-return ratio is known as the Sharpe Ratio. It is a measure of return generated over and…

Q: Leon has in his investment a portfolio that paid him the rate of returns of 14 %, -13%, 15.6%, 17%…

A: AAR=sum of returntotal number of return

Q: Leon has in his investment a portfolio that paid him the rate of returns of 14 %, -13%, 15.6%, 17%…

A: Portfolio management refers to the management of a portfolio under which the returns, deviation of…

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

The following table reports the percentage of stocks in a portfolio for nine quarters: a. Construct a time series plot. What type of pattern exists in the data? b. Use trial and error to find a value of the exponential smoothing coefficient that results in a relatively small MSE. c. Using the exponential smoothing model you developed in part (b), what is the forecast of the percentage of stocks in a typical portfolio for the second quarter of year 3?
Your portfolio has provided you with returns of 4.65 percent, 2.33 percent, 11.85 percent, and -15.97 percent over the past four years, respectively. What is the geometric average return (in percent) for this period? Answer to two decimals
The returns on a portfolio over the last five years were: -5.2 percent, 21.6 percent, 4.5 percent, 11.7 percent, and 5.9 percent. What is the standard deviation of these returns?
What is the standard deviation of the returns of a portfolio that produced returns of -14%, 30%, and -19% over the last three years? (answer in percent, but without the percent sign, e.g. "7.25" is 7.25%)
Consider historical data showing that the average annual rate of return on the S&P 500 portfolio over the past 85 years has averaged roughly 8% more than the Treasury bill return and that the S&P 500 standard deviation has been about 38% per year. Assume these values are representative of investors' expectations for future performance and that the current T-bill rate is 5%. Calculate the expected return and variance of portfolios invested in T-bills and the S&P 500 index with weights as shown below. (Enter your answers as decimals rounded to 4 places. Leave no cells blank - be certain to enter "0" wherever required.) WBills: WIndex: Expected Return: Variance: 0.0 1.0 0.1300 0.1444 Example 0.2 0.8 0.4 0.6 0.6 0.4 0.8 0.2 1.0 0.0
Over the past 3 years, your stock fund earned returns of 10%, -8%, and 12%. What average annual compounded rate did you earn? That is, what is the geometric average rate of return?
An investment portfolio has equal proportions invested in five stocks.The expected returns and standard deviations (both in percent per year) are (8, 3),(5, 2), (12, 8), (7, 9), (14, 15). What are average return and standard deviation forthis portfolio?
Assuming the below annual rates of return: Annual Rates of Return: Wamart - 12.36% Coca Cola - 25.51% Pfizer - 14% CVS - 32.99% Berkshire Hathaway - 29.66% Assume that you initially invested $1,000,000 in the portfolio and that the distribution of the annual rate of return of the portfolio is normal. What is the distribution of the return of the portfolio 20 years after its formation? Provide the graph of the distribution of the return of the portfolio.
Suppose the next month rate of return on a portfolio (worth $1M) is distributed as follows. Return Rate -0.05 -0.03 -0.01 0.00 0.01 0.03 0.04 0.07 0.10 0.12 Probability 1% 1.5% 2.5% 5% 10% 20% 25% 20% 10% 5% What is the expected rate of return given that the return is known to be greater than or equal to 4%?
A portfolio with a 25% standard deviation generated a return of 15% last year when T-bills were paying 4.5%. This portfolio had a Sharpe measure of ____.
Security F has an expected return of 10 percent and a standard deviation of 43 percent per year. Security G has an expected return of 15 percent and a standard deviation of 62 percent per year. Required: (a) What is the expected return on a portfolio composed of 30 percent of Security F and 70 percent of Security G? (b) If the correlation between the returns of Security F and Security G is .25, what is the standard deviation of the portfolio described in part (a)?
A portfolio with a 25% standard deviation generated a return of 15% last year when T-bills were paying 4.5%. This portfolio had a Sharpe ratio of ____.