Question: QUESTION 4 -15 The table below shows historical return for the two types of security assets in 5 years period. These two assets are grouped

QUESTION 4 -15 The table below shows historical return for the

QUESTION 4 -15 The table below shows historical return for the two types of security assets in 5 years period. These two assets are grouped under one portfolio. Years Return for Stock T (%) Return for Stock M (%) 2016 12 20 2017 10 2018 -4 19 2019 1 14 2020 8 21 Based on the table above : (**for questions a,b,c,d and f show calculation manually **) a) Calculate the average rate of return for each stock during 5 years period. b) Calculate the average rate of return for each year. c) Calculate the average rate of return for the portfolio. d) Calculate the standard deviation for each stock and portfolio. e) Calculate the correlation. (Shows the calculation in Excel format) f) Calculate beta for each stock. g) If you are a portfolio manager and this is the portfolio that the client want to invest the funds into, explain the areas you use to discuss further about this portfolio. (25 marks) QUESTION 4 -15 The table below shows historical return for the two types of security assets in 5 years period. These two assets are grouped under one portfolio. Years Return for Stock T (%) Return for Stock M (%) 2016 12 20 2017 10 2018 -4 19 2019 1 14 2020 8 21 Based on the table above : (**for questions a,b,c,d and f show calculation manually **) a) Calculate the average rate of return for each stock during 5 years period. b) Calculate the average rate of return for each year. c) Calculate the average rate of return for the portfolio. d) Calculate the standard deviation for each stock and portfolio. e) Calculate the correlation. (Shows the calculation in Excel format) f) Calculate beta for each stock. g) If you are a portfolio manager and this is the portfolio that the client want to invest the funds into, explain the areas you use to discuss further about this portfolio. (25 marks)

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