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Given below is hypothetical data on two stocks on the LUSE and the market data (All Lusaka Share Index). The market data already includes dividends paid during the year.

Stock 1 Stock 2 Market Index

Year Stock Price Dividend Stock Price Dividend (Includes Dividends)

2013: K25.88 K1.73 K73.13 K4.50 17,495.97

2012: 22.13 1.59 78.45 4.35 13,178.55

2011: 24.75 1.50 73.13 4.13 13,019.97

2010: 16.13 1.43 85.88 3.75 9,651.05

2009: 17.06 1.35 90.00 3.38 8,403.42

2008: 11.44 1.28 83.63 3.00 7,058.96

1)what is the appropriate annual return for stock 1?

2) determine the systematic risk for stock 1.

3)determine the systematic risk for stock 2

4)what is the appropriate average annual return for stock 2

5)what is the appropriate average annual return for the market index

6) calculate the total risk exposure for stock 1

7) calculate the total risk exposure for stock 2

8) calculate the total risk exposure for the market index

9) calculate the downside deviation on returns for stock 1

8) calculate the downside deviation on returns for stock 2

9)calculate the downside deviation on the market index

10) calculate your return expectation on this investment

11)what is the total expected volatility for the investment

12)determine the minimum rate of return you would require from the investment

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