The expected return of portfolio XYZ is 8%. If the portfolio XYZ's variance is 20%, and...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The expected return of portfolio XYZ is 8%. If the portfolio XYZ's variance is 20%, and risk-free rate is 3%, what is the Sharpe Ratio of the portfolio? QUESTION 4 The standard deviation of stock A is .60, while the standard deviation of stock B is .80. If the correlation coefficient for A and B is positive, then a portfolio that consists of 50% of stock A and 50% of stock B MUST have a standard deviation Assume no short selling allowed. What is the portfolio standard deviation given the following data: Stock X has a standard deviation of 40%. Stock Y has a standard deviation of 15%. The portfolio contains 40% of stock X and 60% of stock Y, and the correlation coefficient between the two stocks is -0.5. QUESTION 6 Assume that a potential project has a 75% chance of doubling your investment in a year and a 25% chance of halving your investment in a year. What is the standard deviation of the rate of return on this investment? The expected return of portfolio XYZ is 8%. If the portfolio XYZ's variance is 20%, and risk-free rate is 3%, what is the Sharpe Ratio of the portfolio? QUESTION 4 The standard deviation of stock A is .60, while the standard deviation of stock B is .80. If the correlation coefficient for A and B is positive, then a portfolio that consists of 50% of stock A and 50% of stock B MUST have a standard deviation Assume no short selling allowed. What is the portfolio standard deviation given the following data: Stock X has a standard deviation of 40%. Stock Y has a standard deviation of 15%. The portfolio contains 40% of stock X and 60% of stock Y, and the correlation coefficient between the two stocks is -0.5. QUESTION 6 Assume that a potential project has a 75% chance of doubling your investment in a year and a 25% chance of halving your investment in a year. What is the standard deviation of the rate of return on this investment?
Expert Answer:
Answer rating: 100% (QA)
QUESTION 4 To calculate the portfolio standard deviation for a portfolio consisting of two assets we ... View the full answer
Related Book For
Posted Date:
Students also viewed these finance questions
-
Consider two hypothetical stocks, X and Y. The expected return on stock X is equal to 9% and the expected return on stock Y is equal to 15%. Standard deviation of stock X and Y are 19% and 27%,...
-
There are three assets, A, B and C, where A is the market portfolio and C is the risk-free asset. The return on the market has a mean of 12% and a standard deviation of 20%. The risk-free asset...
-
Ques 1: What is the major complaint by firms concerning the Sarbanes-Oxley act of 2012? A. the legislative maximum allowable compensation for a CEO. B. the legal requirement to disclose project...
-
The following scatter plot indicates that 200 150 > 100 50 0 0 20 X 40 O a log x transform may be useful Oa y transform may be useful a x transform may be useful Ono transform is needed Oa 1/x...
-
Four boxes are placed on a uniform 14-kg wooden plank which rests on two sawhorses. Knowing that the masses of boxes B and D are 4.5 kg and 45 kg, respectively, determine the range of values of the...
-
The management of Onbeach Supply Company desires to include four years' financial statements in this year's annual report. R. Vaughn, CPA, has audited the financial statements of the current and...
-
Lieberman Corporation was organized in 2007. At December 31, 2007, Lieberman's balance sheet reported the following stockholders' equity: Requirements 1. During 2008, Lieberman completed the...
-
Mr. Bates is creating a college fund for his daughter. He will put in $850 at the end of each year for the next 15 years. He expects to earn 6.35% annually. How much money will his daughter have in...
-
Most of the growth in U.S. real GDP since 2001 can be attributed to: 1. growth in the labor force. 2. discovery of new natural resources. 3. increased labor productivity. 4. increased government...
-
Greta and Greg were married for 15 years and have a daughter, Elise. Soon after they were married, they bought their first home for $100,000. Last year Greg was killed in a car accident. In his will,...
-
In the system given, the disc has a mass of 30 kg and a (radius of gyration of 145 mm.) If the 20 kg block A is released from rest, determine the distance the block must fall in order for the disc to...
-
6. Transform the equations given below in a linear form. a) y = ax +4 3 b) = a(x + 2) + b c) y = (ax + b) 1 d) cos y = (ax + b) e) y = aebx f) y = axb
-
How do stakeholder engagement strategies inform organizational governance structures and contribute to sustainable value creation ?Explain
-
1) Whiteness operates in covert and overt ways that affect all of us. It can appear as practices within an institution or accepted social norms. Since whiteness works almost invisibly, we may not...
-
Implement the following circuit in LTSpice using the 2N2222 NPN transistor, R1 = 2.2kOhms, R2 = 100 Ohms and +Vcc = 15 V. 18 = Ic= R1 www 03 Beta= 2N2222 is a general purpose 40V 600mA silicon NPN...
-
Hiram's Lakeside is a popular restaurant located on Lake Washington in Seattle. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern...
-
Honeywell has 9.5 million shares outstanding, and expects its free cash flow to be $14.93 million next year, which is expected to grow by 4.4% per year thereafter. Due to limited data, you do not...
-
Rewrite Programming Exercise 7.5 using streams. Display the numbers in increasing order. Data from Programming Exercise 7.5 Write a program that reads in 10 numbers and displays the number of...
-
Lexy Ballinger and her four-year-old son currently live in an apartment owned by Lexys parents. Her parents charge her very little for rent$200 per month for a luxurious two-bedroom townhouse. Lexy...
-
How is money created in a banking system that has fractional reserve requirements (i.e., a fractional reserve system)?
-
The Ewert Company is evaluating the proposed acquisition of a new milling machine. The machines base price is $108,000, and it would cost another $12,500 to modify it for special use by the firm. The...
-
Part of the water supply for the South Rim of Grand Canyon National Park is taken from the Colorado River [54]. A flow rate of \(600 \mathrm{gpm}\) taken from the river at elevation \(3734...
-
Consider the pump and piping system of Problem 10.51. Estimate the percentage reductions in volume flow rate that occur after (a) 20 years (b) 40 years of use, if the pump characteristics remain...
-
Consider the pump and piping system of Problem 10.50. Determine the volume flow rate and gate valve loss coefficient for the case of two identical pumps installed in parallel. Data From Problem 10.50...
Study smarter with the SolutionInn App