Question regarding risk of investments

Reference no: EM13115791

Over the past 75 years, we have observed that investments with the highest average annual returns also tend to have the highest standard deviations of their annual returns. This observation supports the notion that there is a positive correlation between risk and return. Which of the following lists correctly ranks investments from highest to lowest returns and risk (thus, the highest risk security should be shown first, the lowest risk securities shown last)?

A) small-company stocks, large-company stocks, long-term corporate bonds, long-term government bonds, U.S. Treasury bills

B) small-company stocks, long-term corporate bonds, large-company stocks, long-term government bonds, U.S. Treasury bills

C) large-company stocks, small-company stocks, long-term corporate bonds, U.S. Treasury bills, long-term government bonds

D) U.S. Treasury bills, long-term government bonds, long-term corporate bonds, small-company stocks, large-company stocks

E) large-company stocks, small-company stocks, long-term corporate bonds, long-term government bonds, U.S. Treasury bills

Reference no: EM13115791

Questions Cloud

Describe the range of cf phenotypes : describe the range of CF phenotypes. List the other organs besides lungs that are affected and how does it affects those organs.

How many h atoms are in allyl sulfide : How many moles of Allyl Sulfide (C3H5)2S in 23.2g? How many H atoms are in 0.85 mole of allyl sulfide?How many atoms of Carbon are in 4.20 X 10^23 molecules of allyl sulfide.

Question regarding increased productivity : A company that makes shopping carts for supermarkets and other stores recently purchased some new equipment that reduces the labor content of the jobs needed to produce the shopping carts.

Explain is it reasonable to use a binomial distribution : One variable recorded is the count X of finish defects (dimples, ripples, etc) in the car's paint. Is it reasonable to use a binomial distribution?

Question regarding risk of investments : Over the past 75 years, we have observed that investments with the highest average annual returns also tend to have the highest standard deviations of their annual returns.

Illustrate what are the horizontal and vertical components : The space shuttle begins its landing at a speed of 357 km/hr at an angle of 13 degrees below the horizontal. Illustrate what are the horizontal and vertical components of its velocity?

Explain what is the current market value of a share : what is the current market value of a share of Beta Corp. stock if the required return on Beta Corp. common stock is 15%?

What is expected incidence cf disease in third generation : If two parents are heterozygous carriers of CF, show a pedigree with four children showing the incidence of carriers and afflicted children. If each unafflicted child (carrier or not) has a 1 out of 30 chance of mating with another carrier of CF, ..

Illustrate what is the velocity of each of the two skaters : One skater throws a .3 kg ball at 5 m/s to his friend, who catches it and throws it back at 5 m/s. When the first skater has caught the returned ball, Illustrate what is the velocity of each of the two skaters?

User Account

All Pages