What is the investment proportion

Assignment Help Financial Management

Reference no: EM131913085

Assume that you manage a risky portfolio with an expected rate of return of 19% and a standard deviation of 32%. The T-bill rate is 7%.

Suppose that your client prefers to invest in your fund a proportion y that maximizes the expected return on the complete portfolio subject to the constraint that the complete portfolio's standard deviation will not exceed 17%.

a. What is the investment proportion, y? (Round your answer to 2 decimal places. Omit the "%" sign in your response.)

Investment proportion y _____%??

b. What is the expected rate of return on the complete portfolio? (Round your answer to 2 decimal places. Omit the "%" sign in your response.)

Rate of return ____%??

Reference no: EM131913085

Questions Cloud

Calculate what was your percent return : Investment Return HillCom Corp stock was $75.40 per share at the end of last year. Since then, it paid a $2.90 per share dividend last year.

What percent of horse pregnancies are longer : What percent of horse pregnancies are longer than 339 days?

Prepare a bank reconciliation as of september thirty : McDermott Company's bank statement for September 30 showed an ending cash balance of $1,378. Prepare a bank reconciliation as of September 30.

Describe the protein characteristics in manuscript : What would be the best way to describe the protein's characteristics in the manuscript you are writing based on the chart below? You will choose 1 answer.

What is the investment proportion : Assume that you manage a risky portfolio with an expected rate of return of 19% and a standard deviation of 32%. The T-bill rate is 7%.

Record the entry on date of declaration for a cash dividend : Record the entry on the date of declaration for a cash dividend of 50 cents per share payable on the 511,000 shares of stock outstanding.

Odds ratio for the video game exposure : How would you interpret the odds ratio for the video game exposure?

What is the journal entry made on may twenty eight : On May 15, Brandle sold dollar 52,000 of inventory items on credit with the terms 2/15, net 30. What is the journal entry made on May 28?

How much will she have to save each month to reach to gaol : What is one share of this stock worth to you today if you require a rate of return of 12 percent?

User Account

All Pages