Discuss the meaning of covariance and explain its importance in a portfolio theory?

Fantastic news! We've Found the answer you've been seeking!

Question:

Related Book For answer-question

Operations and Supply Chain Management

ISBN: 978-0078024023

14th edition

Authors: F. Robert Jacobs, Richard Chase

See More Books

Posted Date: Apr 12, 2021 12:48 PM

See More Questions

Discuss the meaning of an optimal capital budget.
Discuss the meaning of MRP terms such as planned order release and scheduled order receipts.
Discuss the meaning of fair value when applied to an NFPOs investments, and give examples of how fair value may be determined.
When the wavelength of radiation falling on a metal is changed from 500 nm to 200 nm, the maximum kinetic energy of the photoelectrons becomes three times larger. The work function of the metal is...
You have $1,000 that you can invest. If you buy Ford stock, you face the following returns and probabilities from holding the stock for one year: with a probability of 0.2 you will get $1,500; with a...
Hatch Company produces a product that passes through three processes: Fabrication, Assembly, and Finishing. All manufacturing costs are added uniformly for all processes. The following information...
Africa offers a fast growing and exciting mobile phone market, with more than 50% growth per year since 2002. More than 28% of African consumers own mobile phones; a larger market than North America....
(a) On January 1, 2012, Fishbone Corporation sold a building that cost $250,000 and that had accumulated depreciation of $100,000 on the date of sale. Fishbone received as consideration a $240,000...
Ethel has an existing loan which she wishes to refinance to obtain a lower rate. Her home has appraised for 352,000. She has requested a new loan in the amount of 264,000 to pay off her old loan and...
Pas Corporation acquired 80 percent of Sel Corporation's common stock on January 1, 2011, for $210,000 cash. The stockholders' equity of Sel at this time consisted of $150,000 capital stock and...
Which of the following is a reason for increased income inequality? a. There is a decrease in the productive capacity of capital so that wages and salaries are instead paid to an improving labor...
Suppose that Glitter Gulch, a gold mining firm, increased its sales revenues on newly mined gold from $100 million to $200 million between one year and the next. Assuming that the price of gold...
On the basis of your answer to question 76, do you believe the advertisement is accurate? Question 76 A natural food company is marketing a new yogurt that it advertises as having only half the fat...
If in some country personal consumption expenditures in a specific year are $50 billion, purchases of stocks and bonds are $30 billion, net exports are $10 billion, government purchases are $20...
The company in question 76 further claims that only 2 % of the cups contain more than half the fat of regular yogurt. What is the probability of our seeing more than 12 cups out of 400 (which is what...
Assume that a grower of flower bulbs sells its annual output of bulbs to an Internet retailer for $70,000. The retailer, in turn, brings in $160,000 from selling the bulbs directly to final...
3. Assume that the donor concentration in an n-type semiconductor at T = 300 K is given by Na(x) = 106-1015x (cm-3) where x is in cm and 0 x 0.01 cm. The electron mobility is, n = 960 cm V.S (i)...
Doorharmony Company makes doorbells. It has a weighted- average cost of capital of 5% and total assets of $ 5,900,000. Doorharmony has current liabilities of $ 750,000. Its operating income for the...
Match the industry type to the expected benefits from an MRP system as High, Medium, or Low. Industry Type............ Expected Benefit (High, Medium, or Low) Assemble-to-stock Assemble-to-order...
In what way does the time horizon chosen for an aggregate plan determine whether it is the best plan for the firm?
As shown in the chapter, the effect of learning in a given system eventually flattens out over time. At that point in the life of a system, learning still exists, though its effect continues to...
A newspaper recently lowered its price from $5.00 to $3.00. As it did, the number of newspapers sold increased from 240,000 to 280,000. a. What was the newspapers elasticity of demand? b. Given that...
Suppose average movie ticket prices are $8.50 and attendance is 1.2 billion. The price of tickets rises to $9.50 and attendance rises to 1.4 billion. a. What happened to total revenue? b. If you were...
Which of the following producers would you expect to support a tax on beer? Which would not? Explain your answer. a. Producers of hard liquor. Cross-price elasticity with beer: 0.11. b. Producers of...

Discuss the meaning of covariance and explain its importance in a portfolio theory?

Question:

Expert Answer:

Covariance could be a statistical tool investors use to live the link between the movement of two as... View the full answer

Operations and Supply Chain Management

Students also viewed these finance questions