What is your coefficient of variation

Assignment Help Financial Management

Reference no: EM132070188

1. Juan just won $2.5 million in the state lottery. He is given the option of receiving a total of $1.3 million now, or he can elect to be paid $100,000 at the end of each of the next 25 years. If Juan can earn 5% annually on his investments, from a strict economic point of view, which option should he take? Explain why.

2. You form the following investment portfolio:

$200,000 of portfolio in REITs, 10% annual return

$500,000 in stocks, 8% annual return

$300,000 in bonds, 4% annual return

If the standard deviation of returns in your portfolio is 5%, what is your coefficient of variation (i.e. risk to return ratio)? Round your answer to two decimal places.

Reference no: EM132070188

Questions Cloud

Professional super funds in terms of investment options : What are the advantages and disadvantages of both REST and Student Super Professional Super Funds in terms of investment options,

What is the profitable index of project : What is the profitable index (PI) of a project that costs $250,000 and will earn $100,000 the first year,

Understanding of debt-equity and derivatives securities : Have a basic understanding of debt, equity and derivatives securities.

What is the payment to investors-total interest received : What is the payment to investors in month 12? What the total interest received by the issuer in month 12?

What is your coefficient of variation : If the standard deviation of returns in your portfolio is 5%, what is your coefficient of variation (i.e. risk to return ratio)?

Practice the measurement of net present value-payback : The purpose of this assignment is to allow the students to become familiar with and practice the measurement of Net Present Value-payback,

Comprehensive exam during financial management : What are the most common asked questions during comprehensive exam during Financial Management.

Level of ipo activity have on venture capital funding : What impact does a country's level of IPO activity have on its venture capital funding?

Considering recapitalization plan : Torrence Publishers is considering a recapitalization plan. Which of the following would help Baldwin minimize capital spending this year?

User Account

All Pages