Question: 1. (10 points) If you know that the expected return of your portfolio is 10% and the standard deviation is 15%, show what is the

1. (10 points) If you know that the expected return of

1. (10 points) If you know that the expected return of your portfolio is 10% and the standard deviation is 15%, show what is the interval the return will be with 95% probability assuming return are normally distributed

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

A portfolio is composed of two stocks A and B The returns of both stocks are given in the table below Stock A has a standard de of the portfolio, while stock B comprises 30% of the portfolio Compute...

The following table shows the expected returns from six different stocks in three different states of the economy: MAY YOU SHOW EXCEL WORK State of Economy Probability Return Stock A Return Stock B...

Covariance and Correlation The following table shows the expected returns from six different stocks in three different states of the economy: State of Economy Probability Return Stock A Return Stock...

Question 10 (10 marks) Penny is a risk averse investor. She has a utility function of the form U = E(R) 0.5A and a risk aversion coefficient (A) of 5. The risk-free rate of return is 4%. Penny can...

Question C2 The information about the risk-free asset, existing portfolios and the stocks considered to be included in the existing portfolio is shown as below: Stock X Stock Y Stock Z Existing...

B. You have recently received $100,000 and you are considering investing $40,000 in the JMMB and $60,000 in CPJ. Your analysis of each stock revealed the following information. The Expected Returns...

There are three states of economy and you are given the following probabilities and returns for each stock for each state of economy. You invest 25% in stock A, 45% in stock B and 30% in stock C....

Points) (i) Given the following information: Expected return on Stock A .15 (15%) Standard deviation of return 0.3 Expected return on Stock B .18 (18%) Standard deviation of return 0.4 Correlation...

Covariance and Correlation The following table shows the expected returns from six different stocks in three different states of the economy: MAY YOU SHOW EXCEL WORK State of Economy Probability...

Every investor will choose a combination between the risk-free asset and the optimal portfolio. Alison P invests 70% of her funds in the risk-free asset and 30% in the optimal portfolio. We call this...

A company uses 20,000 pounds of materials for which it paid $6.00 a pound. The materials price variance was $15,000 unfavorable. What is the standard price per pound? a) $6.00 b) $0.75 c) $5.25 d)...

How does Web advertising work to target ads for individuals? How can users avoid targeted ads?

Una empresa emite una Bono con Valor Nominal de $800 por el cual estar pagando un inters de $40 cada ao. La vigengia del Bono es de 20 aos. Si la empresa vendi el bono en $750, cul es el costo que...

Draw a class diagram and its relationship based on the following statements. You can use any UML tool/software to represent your class diagram. Do NOT copy and paste your diagram, use the attachment...