distributiothe following progabilityfor stocks A andDE20201StateProbability Return on Stock A Return on Stock B10.1010%8%0.2013%7%0.2012%6%0.3014%9%50.2015%8%GhiThe expected rates ofAKLreturn of stocks A andB arerespectively.A 14%; 10%MALAB 13.2%; 9%C 7.7%; 13.2%MAD 13.2%; 7.7%12345234and MALAKLAMALAMA

The Expected Portfolio or the overall rate of return of the Portfolio is the total return which is…

distribution for stocksity Youthe following p 2012 State Probability Return on Stock A Return on Stock B 1 0.10 10% 8% 2 0.20 13% 7% 3 0.20 12% 6% 0.30 14% 9% 5 0.20 15% 8% The expected rates of return of stocks A and Bare LAKL and MALAKL respectively. A 14%; 10% MALA B 13.2%; 9% C 7.7%; 13.2% MAR D 13.2%; 7.7% 2345 4 MALA MA

distribution for stocksity Youthe following p 2012 State Probability Return on Stock A Return on Stock B 1 0.10 10% 8% 2 0.20 13% 7% 3 0.20 12% 6% 0.30 14% 9% 5 0.20 15% 8% The expected rates of return of stocks A and Bare LAKL and MALAKL respectively. A 14%; 10% MALA B 13.2%; 9% C 7.7%; 13.2% MAR D 13.2%; 7.7% 2345 4 MALA MA

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Stocks A and B have the following historical returns:YearStock A's Returns, raStock B's Returns, ra2016(18.60%)(14.50%)201734.2520.40201814.7539.902019(1.00)(9.70)202026.7520.05a. Calculate the average rate of return for each stock during the period 2016 through 2020. Round your answers to two decimal places.Stock A:11.23%Stock B:11.23%b. Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B. What would the realized rate of return on the portfolio have been each year? Round your answers to two decimal places. Negative values should be indicated by a minus sign.YearPortfolio2016-16.55%201727.33201827.33%2019-5.35202023.40What would the average return on the portfolio have been during this period? Round your answer to two decimal places.11.23c. Calculate the standard deviation of returns for each stock and for the portfolio. Round your answers to two decimal places.Stock AStock BPortfolioStandard Deviationd. Calculate the coefficient of variation for each…
Stocks A and B have the following historical returns: Year Stock A’s Returns, rA Stock B’s Returns, rB2013 (24.25%) 5.50%2014 18.50 26.732015 38.67 48.252016 14.33 (4.50)2017 39.13 43.86 a. Calculate the average rate of return for each stock during the period 2013 through2017. Assume that someone held a portfolio consisting of 50% of Stock A and 50% ofStock B. What would the realized rate of return on the portfolio have been in each yearfrom 2013 through 2017? What would the average return on the portfolio have beenduring that period?b. Calculate the standard deviation of returns for each stock and for the portfolio. c. Assume the risk-free rate during this time was 3.5%. What are the Sharpe ratios forStocks A and B and the portfolio over this time period using their average returns?d. Looking at…
Stock A Stock BRate of Return Probability Rate of Return Probability14 0.15 20 0.2016 0.20 18 0.1817 0.30 16 0.3219 0.15 14 0.1420 0.20 10 0.16 a. Calculate the expected return for both stock A and stock B b. Calculate the standard deviation for both stock A and stock B c. Calculate the coefficient of variation for both stock A and stock B.
H5. A stock has had the following year-end prices and dividends: Year Price Dividend 1 $40 — 2 $55 $1.10 3 $60 $1.20 4 $70 $1.30 The geometric average return for the stock is ______%. Group of answer choices 23. 45 20 28. 35 22. 86 33 .41 Show proper step by step calculation and explain with details
Use the following tables to assess the worthiness of Verticon stock as an investment. Verticon Stock Data (Current and Historical) 3:45PM EDT Aug 16, 2011 Price 18.85 USD Change +0.64 (+3.51%) Mkt cap 147.1B Div/yield 0.20/4.24 Shares 8,012 Beta 0.70 Book/share 11.335 EPS 1.11 12/2010 12/2009 12/2008 (Millions of Dollars) Total Assets 195,014 195,949 111,148 Total Liabilities 107,201 122,935 53,592 Preferred Shareholders’ Equity 52 61 73 Common Shareholders’ Equity 87,761 72,953 57,483 Shares Outstanding 8,012 8,070 6746 Book/Share ? 9.040 8.521 Q1 (Mar ’11) 2010 Net profit margin 15.24% 12.24% Return on equity 11.60% 9.30% Which one in bold? One of the most important features of a stock is its book value. The book value per share of Verticon’s stock for the year 2010 was equal to (10.954, 13.693, 11.502). Looking at the (Market cap, EPS, change in price, beta value, ROE) ,…
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Returns, rB 2016 (23.80 %) (17.70 %) 2017 22.50 24.50 2018 14.25 24.00 2019 (2.25 ) (9.70 ) 2020 25.00 14.60 Calculate the average rate of return for each stock during the period 2016 through 2020. Round your answers to two decimal places. Stock A: % Stock B: %
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Returns, rB 2016 (21.10 %) (14.70 %) 2017 23.50 28.50 2018 13.00 29.90 2019 (4.25 ) (10.40 ) 2020 27.75 5.60 Calculate the average rate of return for each stock during the period 2016 through 2020. Round your answers to two decimal places. Stock A:   % Stock B:   % Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B. What would the realized rate of return on the portfolio have been each year? Round your answers to two decimal places. Negative values should be indicated by a minus sign. Year Portfolio 2016   % 2017   % 2018   % 2019   % 2020   % What would the average return on the portfolio have been during this period? Round your answer to two decimal places.   % Calculate the standard deviation of returns for each stock and for the portfolio. Round your answers to two decimal places. Stock A Stock B…
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Returns, rA 2014 (19.00 (14.70 %) 2015 34.75 19.50 2016 13.75 30.90 2017 (4.25 (9.30 ) 2018 34.25 33.10 Calculate the average rate of return for each stock during the period 2014 through 2018. Round your answers to two decimal places. Stock A:   % Stock B:   % Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B. What would the realized rate of return on the portfolio have been each year? Round your answers to two decimal places. Negative values should be indicated by a minus sign. Year Portfolio 2014   % 2015   % 2016   % 2017   % 2018   % What would the average return on the portfolio have been during this period? Round your answer to two decimal places.   % Calculate the standard deviation of returns for each stock and for the portfolio. Round your answers to two decimal places. Stock A Stock B Portfolio…
Historical Realized Rates of Return Stocks A and B have the following historical returns: Year A B 2012 -17.00% -17.90% 2013 21.50 28.20 2014 13.25 27.50 2015 -2.50 -12.10 2016 32.00 21.55 Calculate the average rate of return for each stock during the 5-year period. Round your answers to two decimal places. Stock A % Stock B % Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B. What would have been the realized rate of return on the portfolio in each year? What would have been the average return on the portfolio during this period? Round your answers to two decimal places. Year Portfolio 2012    % 2013    % 2014    % 2015    % 2016    % Average return    % Calculate the standard deviation of returns for each stock and for the portfolio. Round your answers to two decimal places. rA rB Portfolio Std. Dev.    %    % %
Stock A and stock C have the following historical returns: Year Stock A Return Beta Stock C Return Beta 2017 (18%) 0.80 (14.50) 0.90 2018 33% 1.5 21.80% 2.0 2019 15% 2.0 30.50% 1.0 2020 (5.50%) -0.90 (7.60%) -0.50 2021 27% 1.0 26.30% 1.5 a. Calculate the average rate of return for each stock during the period 2017-2021 b. Assume you want to create a portfolio consisting of 60 percent of stock A and 40 percent of stock C, b.1. What would be your realized rate of return on the portfolio have been each year? b.2. What would be your average rate of return on the portfolio have been during this period? c. Calculate the standard deviation of the portfolio return d. Calculate the coefficient of variation for each stock and for the portfolio. e. Assuming you are a risk-averse investor, would you prefer to hold Stock A, Stock B, or the portfolio? Why?
The table below lists the annual return on stock W between 2015 and 2019. Year 2015 2016 2017 2018 2019 Annual Return 12% -10% 20% -4% -8% The annual realized compounded return on stock W between 2015 and 2019 is closest to _____. A. 1.33% B. 2.33% C. 2% D. 3%
Assume these are the stock market and Treasury bill returns for a 5-year period: Year Stock Market Return (%) T-Bill Return (%) 2013 35.90 0.21 2014 15.20 0.21 2015 -5.10 0.21 2016 16.90 0.08 2017 25.90 0.10 a. What was the risk premium on common stock in each year? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Year Risk Premium 2013 % 2014 % 2015 % 2016 % 2017 % b. What was the average risk premium? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) c. What was the standard deviation of the risk premium? (Ignore that the estimation is from a sample of data.) (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

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