# Question

What are the investment proportions of the minimum- variance portfolio of the two risky funds, and what is the expected value and standard deviation of its rate of return?

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long- term government and corporate bond fund, and the third is a T- bill money market fund that yields a rate of 8 percent. The probability distribution of the risky funds is as follows:

The correlation between the fund returns is .10.

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long- term government and corporate bond fund, and the third is a T- bill money market fund that yields a rate of 8 percent. The probability distribution of the risky funds is as follows:

The correlation between the fund returns is .10.

## Answer to relevant Questions

What is the beta of a portfolio with E( rp) = 18 percent, if rf = 6 percent and E( rM) =14 percent? A share of stock sells for $ 50 today. It will pay a dividend of $ 6 per share at the end of the year. Its beta is 1.2. What do investors expect the stock to sell for at the end of the year? Assume that the risk- free rate ...Derive a more general (than the numerical example in the chapter) demonstration of the APT security market line a. For a single- factor market b. For a multifactor market Use the data from The Financial Post in Figure 10.8 to construct the trin ratio for the TSX. Is the trin ratio bullish or bearish? On May 30, 2012, Janice Kerr is considering one of the newly issued 10- year AAA corporate bonds: a. Suppose that market interest rates decline by 100 basis points (i. e., 1 percent). Contrast the effect of this decline on ...Post your question

0