Annual and Average Returns for Stocks, Bonds, and T-Bills, 1950 to 2017Long-Term Treasury1950 to 20171950 to 19591960 to 19691970 to 19791980 to 19891990 to 199920002000 to 2009AvenAnnual ReturnAnnual ReturnAnnual ReturnAnnustAnnual ReturnAnnual Return2015 Annual Return.2016 Annual Return.2017 Annual Return.2010 to 2017Average20102011201220132014201520162017Average20102010C20112011AverageAverageAverageAverageAverageAverasAverageAverage2012 A2012201320132014Standard deviationPortfolio Return%%%%%%%%%Stocks12.7%20.98.77.518.210.2%19.019.00.919:315.1***2.12²216.050%32.413.71.4You have a portfolio with an asset allocation of 50 percent stocks, 38 percent long-term Treasury bonds, and 12 percent T-bills. Usethese weights and the returns given in the above table to compute the return of the portfolio in the year 2010 and each year since.Then compute the average annual return and standard deviation of the portfolio. (Do not round intermediate calculations. Roundyour answers to 2 decimal places.)12.021.814.3Bonds6.6%0.01.65.713.59.59.58.09.429.93.6-12.725.1-1.21.28.48.0T-bills4.30%2.004.006.308.904.902.700.010.020.020.070.050.210.511.390.29

Portfolio return:The portfolio return denotes the aggregate performance of a collection of…

1950 to 2017 1950 to 1959 1960 to 1969 1970 to 1979 1980 to 1989 1990 to 1999 2000 to 2009 Average 2010 Annual Return 2011 Annual Return 2012 Annual Return 2013 Annual Return 2014 Annual Return 2015 Annual Return. 2016 Annual Return. 2017 Annual Return. 2010 to 2017 Average Average Average Average Average Average Average Stocks 12.7% 20.9 8.7 7.5 18.2 19.0 0.9 15.1 2.1 16.0 32.4 13.7 1.4 12.0 21.8 14.3 Long-Term Treasury Bonds 6.6% 0.0 1.6 5.7 13.5 9.5 8.0 9.4 29.9 3.6 -12.7 25.1 -1.2 1.2 8.4 8.0 T-bills. 4.30% 2.00 4.00 6.30 8.90 4.90 2.70 0.01 0.02 0.02 0.07 0.05 0.21 0.51 1.39 0.29 You have a portfolio with an asset allocation of 50 percent stocks 38 percent long term

1950 to 2017 1950 to 1959 1960 to 1969 1970 to 1979 1980 to 1989 1990 to 1999 2000 to 2009 Average 2010 Annual Return 2011 Annual Return 2012 Annual Return 2013 Annual Return 2014 Annual Return 2015 Annual Return. 2016 Annual Return. 2017 Annual Return. 2010 to 2017 Average Average Average Average Average Average Average Stocks 12.7% 20.9 8.7 7.5 18.2 19.0 0.9 15.1 2.1 16.0 32.4 13.7 1.4 12.0 21.8 14.3 Long-Term Treasury Bonds 6.6% 0.0 1.6 5.7 13.5 9.5 8.0 9.4 29.9 3.6 -12.7 25.1 -1.2 1.2 8.4 8.0 T-bills. 4.30% 2.00 4.00 6.30 8.90 4.90 2.70 0.01 0.02 0.02 0.07 0.05 0.21 0.51 1.39 0.29 You have a portfolio with an asset allocation of 50 percent stocks 38 percent long term

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

Year 2009 2010 2011 2012 2013 2014 2015 2016 Average % (-AVERAGE) SD (%) (-STDEVP) SD (%) (-STDEV.S) PSB 2017 2018 Covariance average product of deviations COVAR Correlation = Cov/(SDs * SDb) CORREL (=CORREL) Rates of Return Stock Fund (%) Bond Fund (%) 30.17 5.08 32.97 7.52 21.04 -8.82 -8.10 5.27 -12.89 12.20 -28.53 -7.79 22.49 6.38 12.58 12.40 14.81 17.29 15.50 0.51 Cov(rs,B) OS XOB Slope (Beta) Deviation from Average Returns Stock Fund Bond Fund Product of Deviations Squared Deviation Stock Fund Bond Fund Variance (n) Formula Calculations. Variance (n-1) Formula Calculations
YEAR 2005 STOCK “A" RETURNS (10%) STOCK “B" RTEURNS (3%) 21.29% 2006 18.5% 2007 38.67% 44.25% 2008 2009 14.33% 13.67% 33.00% 28.30% (i) Calculate the average rate of return for each stock during the period 2005-2009. (ii) You hold a portfolio of 50% A and 50% B. What is the rate of return for each vear between 2005 and 2009? (iii) What would have been the average return for the portfolio for the period 2005-2009?
19. You have developed data which give (1) the percentage annual returns of the market for the past five years and (2) similar percentage annual returns information on Stocks A and B. Which of the possible answers best describes the historical beta for A and B? Years Market % returns Stock A % returns Stock B % returns 2023 3% 16% 5% 2022 5% 20% 5% 2021 1% 10% 5% 2020 -10% -25% 5% 2019 6% 24% 5% A) bA > 0; bB = 1. B) bA > +1; bB = 0. C) bA = 0; bB < ─1. D) bA < +1; bB = 0. E) bA > ─1; bB > 1. F) None of the above (state your answer)
Forecasted returns for Stock A: State of the Economy Prob. of State Return in State Prosperity 35% 5% Normal 45% 14% Recession 20% -3% What is the expected return for the stock?
The following return series comes from Global Financial Data. Year Large Stocks LT Gov Bonds US T-bills CPI (Rf asset) (inflation) 2017 21.83% 6.24% 0.80% 2.07% 2018 -5.28% -1.25% 1.81% 2.10% 2019 25.45% 3.35% 2.15% 1.10% 2020 18.16% 10.25% 4.50% 1.88% 2021 28.70% -1.54% 0.40% 7.00% 2022 -19.78% -8.55% 2.20% 6.50% Calculate the average nominal return earned on large-company stocks. (Enter percentages as decimals and round to 4 decimals)
Annual and Average Returns for Stocks, Bonds, and T-Bills, 1950 to 2019 Stocks Long - Term Treasury Bonds T-bills 1950 to 2019 Average 12.7% 6.6% 4.2% 1950 to 1959 Average20.9 0.0 2.0 1960 to 1969 Average 8.7 1.6 4.0 1970 to 1979 Average 7.5 5.7 6.3 1980 to 1989 Average18.2 13.5 8.9 1990 to 1999 Average 19.0 9.5 4.9 2000 to 2009 Average 0.9 8.0 2.7 2010 Annual Return15.1 9.4 0.01 2011 Annual Return 2.1 29.9 0.02 2012 Annual Return 16.0 3.6 0.02 2013 Annual Return32.4-12.7 0.07 2014 Annual Return 13.7 25.10.05 2015 Annual Return 1.4-1.2 0.21 2016 AnnualReturn 12.0 1.2 0.51 2017 Annual Return 21.8 8.4 1.39 2018 Annual Return -4.4 1.8 1.94 2019 Annual Return 31.5 14.8 2.06 2010 to 2019 Average 14.2 7.7 0.63 You have a portfolio with an asset allocation of 62 percent stocks, 30 percent long-term Treasury bonds, and 8 percent T-bills. Use these weights and the returns given in the above table to compute the return of the portfolio in the year 2010 and each year since. Then compute the…
Annual and Average Returns for Stocks, Bonds, and T-Bills, 1950 to 2017 Long-Term Treasury 1950 to 2017 Average 1950 to 1959 Average 1960 to 1969 Average 1970 to 1979 Average 1980 to 1989 Average 1990 to 1999 Average 2000 to 2009 Average 2010 Annual Return 2011 Annual Return 2012 Annual Return 2013 Annual Return 2014 Annual Return 2015 Annual Return 2016 Annual Return 2017 Annual Return Average 2010 to 2017 Stocks 12.7% 20.9 8.7 7.5 18.2 19.0 0.9 15.1 2.1 16.0 32.4 13.7 1.4 12.0 21.8 14.3 Bonds 6.6% 0.0 1.6 5.7 13.5 9.5 8.0 9.4 29.9 3.6 -12.7 25.1 -1.2 1.2 8.4 8.0 T-bills 4.30% 2.00 4.00 6.30 8.90 4.90 2.70 0.01 0.02 0.02 0.07 0.05 0.21 0.51 1.39 0.29 You have a portfolio with an asset allocation of 60 percent stocks, 30 percent long-term Treasury bonds, and 10 percent T-bills. Use these weights and the returns given in the above table to compute the return of the portfolio in the year 2010 and each year since. Then compute the average annual return and standard deviation of the…
Consider the following table for different assets for 1926 through 2020. Standard Deviation 19.7% Series Large-company stocks Small-company stocks Long-term corporate bonds Long-term government bonds Intermediate-term government bonds U.S. Treasury bills Inflation Average return 12.2% 16.2 6.5 6.1 5.3 3.3 2.9 Expected range of returns Expected range of returns a. What range of returns would you expect to see 68 percent of the time for large-company stocks? Note: A negative answer should be indicated by a minus sign. Enter your answers from lowest to highest. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. b. What about 95 percent of the time? 31.3 8.5 9.8 Note: A negative answer should be indicated by a minus sign. Enter your answers from lowest to highest. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. % to % to 5.6 3.1 4.0 % %
Given the following information, what is the standard deviation (in percent) of the returns on this stock? Carry intermediate calculations to at least five decimals. Answer to two decimals Probability of State State of Economy Rate of Return (%) of Economy Recession 15% -12.34 Normal 60% 14.14 Boom 25% 23.77
The following return series comes from Global Financial Data. US T-bills CPI Year Large Stocks LT Gov Bonds (Rf asset) (inflation) 2017 21.83% 6.24% 0.80% 2.07% 2018 -5.28% -1.25% 1.81% 2.10% 2019 25.45% 3.35% 2.15% 1.10% 2020 18.16% 10.25% 4.50% 1.88% 2021 28.70% -1.54% 0.40% 7.00% 2022 -19.78% -8.55% 2.20% 6.50% Calculate the average real risk premium earned on large-company stocks using the approximate Fisher equation. (Enter percentages as decimals and round to 4 decimals)
Annual and Average Returns for Stocks, Bonds, and T-Bills, 1950 to 2017 1950 to 2017 Average 1950 to 1959 1960 to 1969 1970 to 1979 Average Average Average 1980 to 1989 Average 1990 to 1999 Average 2000 to 2009 Average 2010 Annual Return 2011 Annual Return 2012 Annual Return 2013 Annual Return 2014 Annual Return 2015 Annual Return 2016 Annual Return 2017 Annual Return 2010 to 2017 Average Stocks 12.7% 20.9 8.7 7.5 18.2 19.0 0.9 15.1 2.1 16.0 32.4 13.7 1.4 12.0 21.8 14.3 Long-Term Treasury Bonds 6.6% 0.0 1.6 5.7 13.5 9.5 8.0 9.4 29.9 3.6 -12.7 25.1 -1.2 1.2 8.4 8.0 T-bills 4.30% 2.00 4.00 6.30 8.90 4.90 2.70 0.01 0.02 0.02 0.07 0.05 0.21 0.51 1.39 0.29 You have a portfolio with an asset allocation of 50 percent stocks, 32 percent long-term Treasury bonds, and 18 percent T-bills. Use these weights and the returns given in the above table to compute the return of the portfolio in the year 2010 and each year since. Then compute the average annual return and standard deviation of the…
Review the following market information: Current Stock Market Return 11.25% Current T-Bill Price $979.43 Historic T-Bill Average Return 2.80% Historic Stock Market Average Return 8.10% Stock Beta 1.23 What is the required return (rounded to two places)?

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS