About portfolio you are to manage

Assignment Help Financial Management

Reference no: EM131972635

1. Use the table to answer the question

Bond Features

Face Value = $1,000

Coupon Rate = 7.00%

Maturity in Years = 3

Market Interest Rate = 4.50%

What is the % current yield from today to year 1?

6.5499%

6.4189%

6.2879%

6.6809%

6.6154%

2. You are given the following information about a portfolio you are to manage. For the long-term you are bullish, but you think the market may fall over the next month.

Portfolio Value: $1 million

Portfolio’s Beta: 0.60

Current S&P 500 value: 1400

Anticipated S&P 500 Value: 1200

For a 200-point drop in the S&P 500, by how much does the value of the futures position change?

A. $100,000

B. $200,000

C. $500,000

D. $250,000

E. $50,000

Reference no: EM131972635

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