Suppose an investment analyst takes a random sample of us

Assignment Help Finance Basics

Reference no: EM13801952

a) Suppose an investment analyst takes a random sample of U.S equity mutual funds and calculates Sharp Ratio. The sample size is 100, and the average sharp ratio is 0.45. The sample has a standard deviation of 0.30. Calculate and interpret the 90 percent confidence interval for the population mean of all U.S. equity mutual funds by using a reliability factor based on the standard normal distribution.

b) A money manager wants to obtain a 95 percent confidence interval for fund inflows and outflows over the next six months for his existing clients. He begins by calling a random sample of 10 clients and inquiring about their planned additions to and withdrawals from the fund. The manager then computes the change in cash flow for each client sampled as a percentage change in total funds placed with the manager. A positive percentage indicates a net cash inflow to the client's account, and a negative percentage change indicates a net cash outflow from the clients account. The manager weights each response by the relative size of the account within the sample and then computes a weighted average.As a result of this process, the money manager computes a weighted average of 5.5 percent. Thus, a point estimate is that the total amount of funds under management will increase by 5.5 percent in the next six months. The standard deviation of the observations in the sample is 10 percent. A histogram of past data looks fairly close to normal, so the manager assumes the population is normal

Calculate a 95 percent confidence interval for the population mean and interpret your findings.
Using the sample mean of 5.5 percent and standard deviation of 10 percent, compute the confidence interval for sample sizes of 20 and 30.
Interpret your results from Part a and Part b.

Reference no: EM13801952

Questions Cloud

Identify and analyze the approachs to negotiation : Identify and analyze the approach(s) to negotiation that the parties employed. Identify opportunities for employing other kinds of negotiation strategies and suggest how those strategies could have led to different outcomes.

Use work and energy principle to find velocity : A spring stiffness k= 500 n/m is mounted against a 10 kg block. if the block is subjected to a force of 1 KN determine the velocity of the block at s=0.3 m when s=0, the block is at rest and the spring is uncompressed. The coefficient of fricktion is..

Summarizing a functional requirement of the system : A list of at least 20 use cases, each one summarizing a functional requirement of the system in a sentence or two. This is also a good place to indicate possible security threats. You can specify security threats and/or system constraints either w..

Indicate whether the f is statistically significant : 14. For each of the following F values, indicate whether the F is statistically significant at the specified alpha level: a. F = 4.80, df = 4, 40 α = 0.01 b. F = 5.02, df = 3, 60, α = 0.001 c. F = 3.45, df = 3, 27, α = 0.05 d. F = 4.99, df = 2, 150, ..

Suppose an investment analyst takes a random sample of us : a) Suppose an investment analyst takes a random sample of U.S equity mutual funds and calculates Sharp Ratio. The sample size is 100, and the average sharp ratio is 0.45. The sample has a standard deviation of 0.30. Calculate and interpret the 90 per..

Analyze the government''s role in protection of environment : Analyze the government's role in the protection of the environment. Be sure that your analysis includes a look at one of the following: conservation, environmentalism, protection, global warming, and energy concerns. How has the regulation of one ..

The federal government : A new motorcycle is being developed to meet new gas mileage standards recently passed by the federal government. An engineer tested three model designs by randomly assigning the motorcycles in a blind study (the riders recorded the mileage but did no..

Write the parametric form of the unit circle : Write the parametric form of the unit circle. Given an arbitrary positive integer n, write an algorithm that generates n evenly spaced points that are sampled along the unit circle

Intervention promotes efficiency and equity in the economy : Discuss how government intervention promotes efficiency and equity in the economy. Be sure that you include restraint of trade, indirect costs, deregulation, and overregulation within your analysis.

User Account

All Pages