Question $4$:

Suppose last year you bought $400$ shares of ABC at $150$SAR per share and bought $200$ shares of XYZ at $200$ SAR per share. This year, the prices of ABC's stock rose to I$70$ SAR per share and XYZ$\text{'}$s stock fell to $190$ SAR per share, and neither stock paid dividends. When you invested in those stocks, you knew that the standard deviation for ABC was $35\%,$ standard deviation for $xYZ$ was $22\%,$ and correlation between them was $0\mathrm{.}43.$ Answer following questions:

a$)$ What were the weights for ABC and $xYZ$ in your investment portfolio when you just invested in these stocks?

$[1\mathrm{.}0$ mark $]$

b$)$ What was the realized retum of ABC and $xYZ?$

$[1\mathrm{.}0$ mark$]$

c$)$ What was the returm of the entire portfolio?

$[1\mathrm{.}0$ mark

d$)$ What is the volatility of the portfolio?

$[1\mathrm{.}0$ mark$]$

c$)$ What happened to the total risk $($as measured by the standard deviation$)$ of the portfolio according to portfolio theory? Briefly explain why.

$[1\mathrm{.}0$ mark$]$

Question $3$: $,$

Saudi Electricity Company has issued Islamic bonds $($Sukuk$)$ to raise additional capital and fund future projects as part of achieving the Kingdom of Saudi Arabia $2030$ Vision. On the website of the Saudi Exchange $($Tadawul$),$ you find following information regarding the Saudi Electricity' bond: $10$ year maturity, $200,000$ SAR face value, and coupon rate of $4\mathrm{.}6\%$ APR with quarterly payments. Assuming the appropriate yield to maturity on the Saudi Electricity's bond is $9\mathrm{.}1\%.$ Answer following questions:

a$)$ Draw the cash flows for the Saudi Electricity's bond on a timeline that depicts the given information accurately.

b$)$ At what price the bond of Saudi Electricity must be trading for today?

c$)$ Does the bond trade at discount, par, or premium? Briefly explain the reasen.