Calculate the expected return of stock a

Assignment Help Financial Management

Reference no: EM13214443

You are considering the following two stocks for your portfolio and have observed the following.

1688_Calculate the expected Return of Stock A.png

The risk free rate is 0.04 and you are considering investing 60% of your funds in Stock A and 40% in Stock B.

Calculate the following.

a) Expected Return of Stock A

b) Expected Return of Stock B

c) Standard Deviation of Stock A

d) Standard Deviation of Stock B

e) Coefficient of Variation of Stock A

f) Coefficient of Variation of Stock B

g) Covariance of Stocks A and B

h) Correlation Coefficient of Stocks A and B

i) Portfolio Return

j) Portfolio Standard Deviation and Variance

k) Weights of the Minimum Variance Portfolio

l) Proof that these weights lead to the Minimum Variance Portfolio

m) Weights of the Optimal Risky Portfolio with a risk-free asset

n) Proof that these weights lead to the Optimal Risky Portfolio

o) Discussion on what you would do with this portfolio

Reference no: EM13214443

Questions Cloud

Explain samples temperature probes and allowed to evaporate : 2 liquids, A and B, have the same molecular weight. Samples of each are placed on temperature probes and allowed to evaporate. After a period of time Liquid A had a change in temp

How much profit does each firm make : Suppose there are two firms in a market who each simultaneously choose a quantity. Firm 1's quantity is q1, and firm 2's quantity is q2. Therefore the market quantity is Q = q1 + q2. The market demand curve is given by P = 60 - 4Q.

Find what is the monopolists total cost function : Suppose a monopolist can purchase Labor at a price w = 36 and can purchase Capital at a price r = 25. The monopolist's production function is given by Q = L1/2K1/2. The demand facing the monopolist is given by P = 180 - 3Q.

Poked a hole in the foil thus the vapor could push out air : We did a lab in Chem where we put a liquid into a flask, secured foil on the top and poked a hole in the foil so the vapor could push out the air

Calculate the expected return of stock a : Calculate the expected Return of Stock A, expected Return of Stock B, standard Deviation of Stock A and standard Deviation of Stock B

What advertising level should each firm choose : Firm M and N compete for a market and decide independently how much to advertise. Each can spend either $10 million or $20 million on advertising. If the firms spend equal amounts, they split the $120 million market equally.

Define equations represents the proper net ionic equation : Which of the following equations represents the proper net ionic equation for the complete neutralization reaction between the weak acid HClO2 (aq) and the strong base KOH (aq)?

Determine whether the two inequalities above are consistent : US Output: 100 units Labor: 20 workers Wages: $3 Exports:$90 UK Output: 50 units Labor: 20 workers Wages:$2 Exports: $45 1.) Compare the relative productivity with the wage ratio 2.) Then calculate the ratio of the two exports. 3.) Determine whether ..

Explain molar analytical concentration of kcl : A solution was prepared by dissolving 5.76g of KCL*MgCl2*6H2O (277.85g/mol) in sufficient water to give 2.000L

User Account

All Pages