What would be the expected risk on portfolio

Assignment Help Finance Basics
Reference no: EM132002907

Question: Mr. Jones has a 2-stock portfolio with a total value of $550,000. $205,000 is invested in Stock A and the remainder is invested in Stock B. If standard deviation of Stock A is 19.45%, Stock B is 10.60%, and correlation between Stock A and Stock B is -0.10, what would be the expected risk on Mr. Jones' portfolio (standard deviation of the portfolio return)?

Reference no: EM132002907

Questions Cloud

Coupon bond cash flow zero coupon bond cash flow : How many of the zeroes would you need to issue? Coupon bond cash flow Zero coupon bond cash flow.
What will be the loan EAR : You want to buy a car, and a local bank will lend you $35,000. What will be the loan's EAR?
Did the fbi act under the color of any international laws : In 2000, FBI special agents lured Russian cyber criminals Vasiliy Gorshkov and Alexey Ivanov to the United States with a ruse involving a job interview.
Calculate the price of zero coupon bond : Calculate the price of a zero coupon bond that matures in 14 years if the market interest rate is 5.95 percent.
What would be the expected risk on portfolio : Mr. Jones has a 2-stock portfolio with a total value of $550,000. $205,000 is invested in Stock A and the remainder is invested in Stock B.
What is the importance of creating own data types : What is the importance of creating your own data types? What are the benefits and drawbacks from developing your own data types?
Demonstrate the class in a program that creates a car object : Code a class named Car that has the following member variables:
Find the future values of these ordinary annuities : Find the future values of these ordinary annuities. Compounding occurs once a year.
Should you pay it towards your mortgage : You have a mortgage with a 5% interest rate and a student loan with 10% interest rate. Your mortgage debt is $100,000 whereas your student debt is $10,000.

Reviews

Write a Review

Finance Basics Questions & Answers

  How many shares will need to be issued

Suppose the company cancels the dividend and announces that it will use the money saved to repurchase shares. What happens to the stock price on the announcement date?

  Evaluate performance of a supplier

Using the 10 categories of customer expectations in Table 3-1, develop your own examples of how customers might evaluate performance of a supplier.

  Forward exchange rate

Suppose that the annual interest rate is 5.0 percent in the United States and 3.5 percent in Germany, and that the spot exchange rate is $1.12/€ and the forward exchange rate, with one-year maturity, is $1.16/€.

  Describe the internal rate of return method

King's Department Store is contemplating the purchase of a new machine at a cost of $13,869. The machine will provide $3,000 per year in cash flow for six.

  What is marys effective annual rate

Mary purchased 100 shares of Sweet Pea Co. stock at a price of $40.31 six months ago. She sold all stocks today for $45.36. During that period the stock paid dividends of $1.25 per share. What is Mary's effective annual rate?

  Conditions to make a percent of sales forecast

What conditions would help make a percent-of-sales forecast almost as accurate as pro forma financial statements and cash budgets?

  Function of foreign exchange market

What is the function of foreign exchange market? Who are the market participants? Write down the difference between the spot and forward markets

  Npv of the alaska purchase

What is the NPV of the Alaska purchase, assuming that you arein 1867 looking forward? (Enter just the number in dollars without the $ sign or a comma and round off decimals.) Hint: Simple payback calculation, but with discounting.

  Preparing a trial balance

Refer to the T-accounts created in PE 3-17. Using the ending balances in those T-accounts, create a trial balance.

  After extensive research you believe the probability

after extensive research you believe the probability distribution for next years return on fb inc

  What is the npv of the project

Flatte Restaurant is considering the purchase of a $10,400 soufflé maker. The soufflé maker has an economic life of five years and will be fully depreciated by the straight-line method.

  Basis of a mistake in the first appraisal

In the counteroffer, Englesen asked Kepple to remove from their contract a clause requiring written confirmation of the availability of a "free split"

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