ATTEMPT THE FOLLOWING QUESTIONS QUESTION 1 The following information relates to the prices and dividends of two stocks listed on the Ghana Stock Exchange as well as the average market returns. Year 2011 2012 2013 2014 2015 2016 Stock A Price 20 24 26 31 33 40 Div 0 25 1.2 0.5 1 1.5 2 Price HEE 11 13 17 20 23 27 Stock B Div 0 1.6 0.5 0.9 1.2 1.5 Market Returns 0 0.25 0.18 0.11 0.12 0.15

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A: Black Scholes OPM is the option pricing Model used to price options contract i.e. call or put…

Q: What is the relationship of a portfolio standard deviation to the weighted average standard…

A: The standard deviation measures volatility of an investment or the risk of an investment. The…

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Q: Illustrate the formula for portfolio beta and portfolio expected return.

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Q: Assume

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Q: What is the systematic risk for a portfolio with two-thirds of the funds invested in X and one-third…

A: The systematic risk of a portfolio is measured by the beta of the portfolio

Q: b) The covariance between stocks A and B is 0.0014, standard deviation of stock A is 0.032, and…

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Q: The VIX measures Select one: a.Realized volatility B. Current volatility C. Historical volatility D.…

A: The VIX stands for volatility index. Volatility index was the first benchmark which was created by…

Q: the expected returns of the stocks A and B.

A: Expected Return The expected return of the stock is the probability weighted return of the stock. ER…

Q: 234567 5 1 2 Month 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 #2 3 4 5 6…

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Q: It is a risk adjusted performance measure that represents the average return on a portfolio. a.…

A: Correct answer is (a) sharp ratio

Q: The table below contains the covariance matrix of stock returns and the market. Assume that the…

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Q: What is the formula for the Sharpe Ratio for a two-asset portfolio of stocks and bonds with equal…

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Q: and bonds and Portfolio B which consists purely of cryptoc following information on the portfolios:…

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Q: Questions: a. Compute the expected return for stock X and for stock Y b. Compute the standard…

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Q: Beta is which of the following: A) standard deviation. B) total risk. C) Beta is the relationship…

A: option C is correct  Beta is the relationship which is between an investment's return, and the…

Q: 2. Consider a portfolio comprised of three securities in the following proportions and with the…

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Q: Considering the attached set of securities and portfolio returns: Find the combination of the…

A: The Coefficient of Variation (CV): The coefficient of variation is useful in determining if a…

Q: Which of the following measures the total risk of a​ portfolio?   A. Standard Deviation   B.…

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Q: The slope of the Security Market Line equals to ____, and the slope of Capital Allocation Line…

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Q: States Probability Asset M Return Asset N Return Asset O Return Вoom 32% 13% 23% 5% Normal 50% 11%…

A: Portfolio Return = Return on asset M * 1/3 + Return on asset N * 1/3 + Return on asset O * 1/3…

Stock Market Indices

Stock indexes are used to compare the price fluctuations of a group of stocks of similar companies, which are combined based on a similar industry or a particular market capitalization limit or type of market. The price comparison is based on a pre-determined standard method or indicators. These stock indexes are usually considered a base for comparison of a particular stock, and the performance of that particular company can be easily determined.