Mushi allocate to the healthcare sector etf

Assignment Help Finance Basics
Reference no: EM133003608

Mushi is the retired CEO of a large pharmaceutical company and currently owns $2M worth of shares in his company, which he had previously received as part of his compensation package. Mushi is not allowed to sell those shares for the next 3 years. Mushi also has $10M in cash that he wants to invest in the stock market. Mushi believes in the CAPM and thus wants exposure to the market portfolio. Mushi is considering investing (long or short) in sector ETFs to achieve this goal. The weight of the Healthcare sector in the market is 5%. Assume for simplicity that the Healthcare sector is perfectly correlated to Mushi's pharmaceutical stock. Approximately how many dollars should Mushi allocate to the Healthcare sector ETF?

Reference no: EM133003608

Questions Cloud

How might an auditor devise a procedure to catch fraudulent : Albert owned and operated 40 coin laundries around town. How might an auditor devise a procedure to catch this fraudulent scheme?
Charge a below-market interest rate : Real estate 8. Which of the following allows a lender to increase the upfront yield on a loan and enables the lender to charge a below-market interest rate?
Performing stocks over the past year : Consider the Fama-French + Momentum asset pricing model, where in addition to the Fama-French three factors, a fourth factor for momentum is also included. Spec
Identify the asset description : Identify the Asset Description. After years of pressure by residents, town council approved the re-surfacing of Donald Street from 1st avenue to 7th avenue
Mushi allocate to the healthcare sector etf : Mushi is the retired CEO of a large pharmaceutical company and currently owns $2M worth of shares in his company, which he had previously received as part of hi
Find the future value if earns four percent per year : STUDENTS of Business Math .2021, have $580,000 to invest for 1 year. Find the future value if it earns 4%, per year compounded quarterly
What is invesco global strategy : What is Invesco's global strategy? What are the key risks? How has/ will MiFID II affect Invesco?
Calculate the expected standard deviation of the portfolio : An investor wishes to construct a portfolio consisting of a TD% allocation to a stock index and a 3U% allocation to a risk free asset. The return on the risk-fr
What do think is the best way to finance for a company : What do you think is the best way to finance yourself for a company? Analyze all the possibilities that you consider pertinent, justify and argue

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd