Five years ago beginning October 1, 2016 and ending September 30, 2021 you invested $1,000 in something and discussed it beforehand with your spouse/partner.

Consider two scenarios: 

a) you invested in Invesco S&P SmallCap Energy ETF and the fund did poorly and 

b) you didn’t invest in Bitcoin and it did well. In both scenarios, your spouse/partner now claims to have told you to do the opposite of what you did. Compute the following for the security/commodity during the 5 years (only ii should be on an after tax basis): 20 pts. Rate of return before taxes Rate of return after federal/state/local New York City taxes (assume you’re in the 22% federal income tax bracket. Volatility Beta Sharpe measure Jensen alpha. Re-compute each figure above for both the security and your equity investment if you instead only invested $500 of your own cash and borrowed on margin an additional $500 to invest in the security at an average 5% interest rate over the five years? Note: figures for equity investment may differ from those for the security itself. 

A. Oct 1, 2016 price: $18.31 54.615 shares 

B. Sept. 30, 2021: $7.62 Return on Investment: $416.16 Rate of Return %: - 58.38% Bitcoin: A. Oct 1, 2016: $613.98 1.629 BTC B. Sept 30, 2021: $43,790.89 ROI: $71,335.36 Rate of Return %: 7,033.54%

Answer rating: 100% (QA)

A Rate of return before taxes Invesco SP SmallCap Energy ETF The rate of return before taxes for Invesco SP SmallCap Energy ETF over the five years period from October 1 2016 to September 30 2021 is 5... View the full answer