Find out the values of total risk-systematic risk of stock

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Reference no: EM132066426

1. Find out the values of total risk, systematic and non systematic risk of stock j in variance term.

The mean of excess market return is 1.33%

The mean of excess return on asset j is 3.0%

The variance of excess market return is 2.89%

The variance of excess returns on asset j is 2.0%

The covariance of excess market returns and excess returns on asset j is 2.33%

2. Which of the following would be considered bullish (indicative of an optimistic market)?

a. Buying credit default swaps

b. Sales of STRIPS are increasing relative to sales of corporate bonds

c. Interest coverage ratios are increasing

d. Less money going towards defined contribution funds

Reference no: EM132066426

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