Question 4 (a) Round off your answer to two (2) decimal points for the calculation. Any rates or returns expressed in percentage is preferred. An investor invested $2,000 in a mutual fund's shares. The fund had the following total returns over a 4-year period. Calculate the value of this investment at the end of the 4-year period, the arithmetic mean annual return, and the geometric mean annual return. Write the corresponding Excel formula for each calculation. A Actual Return 1 2 10.40% 3 6.80% 4 4.20% 5 -9.30% 6 7 8 Investment $2,000 (6 marks) (b) A portfolio consists of the following assets: _ A B c D _ E _ Investment Market Value Variance Allocation Stock $400 . Bond $1.000 2.00% C lyptocun'ency $600 14.00% Total Market Value $2,000.00 mhwmI Round off your answer to two (2) decimal points for the calculation. Calculate the expected return of the portfolio and write the corresponding Excel formulas. If all stocks are sold and half of the funds are used to buy bond and the other half to buy cryptocurrency, what is the variance of the new portfolio if the correlation between bond and cryptocurrency is -0.01 ? Write the Excel formula used for this calculation as well. In your formula, you may use a combination of numbers (other than 0 or 1) and Excel cell references. (7 marks) (C) Below is part of a client's Investment Policy Statement (IPS) and a list of nancial products that she is considering. IPS Objectives Return: 4-10% per annum Risk: Low - able to tolerate a loss no more than 5% of the total amount invested Constraints and Preferences Investment horizon: 1-2 years. Social- and environmental-friendly companies or industries preferred. S&P 500 with an estimated annual return of 4.5% Small-ca fund with an estimated annual return of 8% and moderate risk _ Initial coin offering of a cryptocurrency with high return potentials that expects to be listed on exchange after 3 years - Stocks of a tobacco com an H AAA-rated co orate bond There is also a note which says that the client has stable income that well satises her living costs and usual expenditure and she has no debts. Analyse the client's risk aversion type. Specically, does the ability and willingness to take risk match? What is your suggestion to her portfolio manager? Based on her IPS information, list the products that you will NOT recommend to her and discuss your reasons. Round off your answer to two (2) decimal points for the calculation. Any rates or returns expressed in percentage is preferred. The table below summarises the investment information of stocks in Company A, B, and C. What is the risk-free rate? Write the corresponding Excel formula. Based on the IPS, which stock should the client invest in and why? A B C D 1 Investment Return Variance Share Ratio 2 Stock in Company A 21.00% 3 Stock in C0111 any B 12.20% 4 :Stock in Company C 8.50% (12 marks)