The table below shows the annual return of ARK Innovation ETF (ARKK) [1] and the S&P500...

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The table below shows the annual return of ARK Innovation ETF (ARKK) [1] and the S&P500 stock index for the period of 2019-2022. Year 2019 2020 2021 2022 Arithmetic average Geometric average Standard deviation Correlation coefficient Annual Percentage Change ARKK 35.2% 152.5% -23.4% -67.0% (a) -3.6% (c) 0.45 S&P 500 34.5% 18.4% 28.7% -18.1% 27.2% (b) 23.6% a.) Calculate the values for cell (a), (b), and (c). Show your steps below. b.) An investor has $100,000 at the end of year 2019. She invests $60,000 in ARKK and the rest is invested in the S&P500 ETF fund. What is the standard deviation of her portfolio? c.) Continue from part b) - based on the given information, if you have to guess what the return of her portfolio will be in 2023, what is your best guess? Explain your answer. The table below shows the annual return of ARK Innovation ETF (ARKK) [1] and the S&P500 stock index for the period of 2019-2022. Year 2019 2020 2021 2022 Arithmetic average Geometric average Standard deviation Correlation coefficient Annual Percentage Change ARKK 35.2% 152.5% -23.4% -67.0% (a) -3.6% (c) 0.45 S&P 500 34.5% 18.4% 28.7% -18.1% 27.2% (b) 23.6% a.) Calculate the values for cell (a), (b), and (c). Show your steps below. b.) An investor has $100,000 at the end of year 2019. She invests $60,000 in ARKK and the rest is invested in the S&P500 ETF fund. What is the standard deviation of her portfolio? c.) Continue from part b) - based on the given information, if you have to guess what the return of her portfolio will be in 2023, what is your best guess? Explain your answer.

Answer rating: 100% (QA)

Answer a We add the annual returns for ARKK and the SP 500 and divide by the number of years 4 to arrive at the arithmetic average ARKK 352 1525 234 670 4 243 SP 500 345 184 287 181 4 159 As a result ... View the full answer