Standard deviation of portfolio: Volatility refers to a formal measure of risks involved in stocks. The higher the volatility of a stock, the greater is its ups and down swings. The volatility of a portfolio of stocks is a measure of how the total value of the stocks in a portfolio appreciates or declines. It can be obtained by the measuring the standard deviation of the portfolio. Expected Return of a Portfolio The Expected Return of a Portfolio refers to the weighted average of the expected returns on each individual investment in a particular portfolio. The expected return of a portfolio is hence related to the expected return of the stocks in a portfolio. The Expected Return of a Portfolio can be calculated using the formula given below. Where, is the expected return of portfolio. is the weight of the investment or stock. is the expected return of investment or stock. To ascertain: The stock to be added to the portfolio.

Question

Want to see the full answer?

Answer 1

Question

Chapter 12, Problem 17P

Summary Introduction

Standard deviation of portfolio:

Volatility refers to a formal measure of risks involved in stocks. The higher the volatility of a stock, the greater is its ups and down swings. The volatility of a portfolio of stocks is a measure of how the total value of the stocks in a portfolio appreciates or declines. It can be obtained by the measuring the standard deviation of the portfolio.

Expected Return of a Portfolio

The Expected Return of a Portfolio refers to the weighted average of the expected returns on each individual investment in a particular portfolio. The expected return of a portfolio is hence related to the expected return of the stocks in a portfolio.

The Expected Return of a Portfolio can be calculated using the formula given below.

Where,

is the expected return of portfolio.

is the weight of the investment or stock.

is the expected return of investment or stock.

To ascertain: The stock to be added to the portfolio.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 2

Question

Chapter 12, Problem 17P

Summary Introduction

Standard deviation of portfolio:

Volatility refers to a formal measure of risks involved in stocks. The higher the volatility of a stock, the greater is its ups and down swings. The volatility of a portfolio of stocks is a measure of how the total value of the stocks in a portfolio appreciates or declines. It can be obtained by the measuring the standard deviation of the portfolio.

Expected Return of a Portfolio

The Expected Return of a Portfolio refers to the weighted average of the expected returns on each individual investment in a particular portfolio. The expected return of a portfolio is hence related to the expected return of the stocks in a portfolio.

The Expected Return of a Portfolio can be calculated using the formula given below.

Where,

is the expected return of portfolio.

is the weight of the investment or stock.

is the expected return of investment or stock.

To ascertain: The stock to be added to the portfolio.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 12, Problem 17P

Summary Introduction

Standard deviation of portfolio:

Volatility refers to a formal measure of risks involved in stocks. The higher the volatility of a stock, the greater is its ups and down swings. The volatility of a portfolio of stocks is a measure of how the total value of the stocks in a portfolio appreciates or declines. It can be obtained by the measuring the standard deviation of the portfolio.

Expected Return of a Portfolio

The Expected Return of a Portfolio refers to the weighted average of the expected returns on each individual investment in a particular portfolio. The expected return of a portfolio is hence related to the expected return of the stocks in a portfolio.

The Expected Return of a Portfolio can be calculated using the formula given below.

Where,

is the expected return of portfolio.

is the weight of the investment or stock.

is the expected return of investment or stock.

To ascertain: The stock to be added to the portfolio.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 12, Problem 17P

Summary Introduction

Standard deviation of portfolio:

Volatility refers to a formal measure of risks involved in stocks. The higher the volatility of a stock, the greater is its ups and down swings. The volatility of a portfolio of stocks is a measure of how the total value of the stocks in a portfolio appreciates or declines. It can be obtained by the measuring the standard deviation of the portfolio.

Expected Return of a Portfolio

The Expected Return of a Portfolio refers to the weighted average of the expected returns on each individual investment in a particular portfolio. The expected return of a portfolio is hence related to the expected return of the stocks in a portfolio.

The Expected Return of a Portfolio can be calculated using the formula given below.

Where,

is the expected return of portfolio.

is the weight of the investment or stock.

is the expected return of investment or stock.

To ascertain: The stock to be added to the portfolio.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 12, Problem 17P

Summary Introduction

Standard deviation of portfolio:

Volatility refers to a formal measure of risks involved in stocks. The higher the volatility of a stock, the greater is its ups and down swings. The volatility of a portfolio of stocks is a measure of how the total value of the stocks in a portfolio appreciates or declines. It can be obtained by the measuring the standard deviation of the portfolio.

Expected Return of a Portfolio

The Expected Return of a Portfolio refers to the weighted average of the expected returns on each individual investment in a particular portfolio. The expected return of a portfolio is hence related to the expected return of the stocks in a portfolio.

The Expected Return of a Portfolio can be calculated using the formula given below.

Where,

is the expected return of portfolio.

is the weight of the investment or stock.

is the expected return of investment or stock.

To ascertain: The stock to be added to the portfolio.

Answer 6

Chapter 12, Problem 17P

Summary Introduction

Standard deviation of portfolio:

Volatility refers to a formal measure of risks involved in stocks. The higher the volatility of a stock, the greater is its ups and down swings. The volatility of a portfolio of stocks is a measure of how the total value of the stocks in a portfolio appreciates or declines. It can be obtained by the measuring the standard deviation of the portfolio.

Expected Return of a Portfolio

The Expected Return of a Portfolio refers to the weighted average of the expected returns on each individual investment in a particular portfolio. The expected return of a portfolio is hence related to the expected return of the stocks in a portfolio.

The Expected Return of a Portfolio can be calculated using the formula given below.

Where,

is the expected return of portfolio.

is the weight of the investment or stock.

is the expected return of investment or stock.

To ascertain: The stock to be added to the portfolio.

Answer 7

Chapter 12, Problem 17P

Summary Introduction

Standard deviation of portfolio:

Volatility refers to a formal measure of risks involved in stocks. The higher the volatility of a stock, the greater is its ups and down swings. The volatility of a portfolio of stocks is a measure of how the total value of the stocks in a portfolio appreciates or declines. It can be obtained by the measuring the standard deviation of the portfolio.

Expected Return of a Portfolio

The Expected Return of a Portfolio refers to the weighted average of the expected returns on each individual investment in a particular portfolio. The expected return of a portfolio is hence related to the expected return of the stocks in a portfolio.

The Expected Return of a Portfolio can be calculated using the formula given below.

Where,

is the expected return of portfolio.

is the weight of the investment or stock.

is the expected return of investment or stock.

To ascertain: The stock to be added to the portfolio.

Answer 8

Expert Solution & Answer

Answer 9

Expert Solution & Answer

Answer 10

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 11

Ch. 12 - Prob. 1CC Ch. 12 - How is the expected return of a portfolio related...Ch. 12 - What determines how much risk will be eliminated...Ch. 12 - When do stocks have more or less correlation?Ch. 12 - What is the market portfolio?Ch. 12 - Prob. 6CC Ch. 12 - Prob. 7CC Ch. 12 - Prob. 8CC Ch. 12 - Prob. 1CT Ch. 12 - What does correlation tell us?

Concept explainers

Videos

Want to see the full answer?

Chapter 12 Solutions