Consider the following stock price returns for Costco and Capital One. Demonstrate all your work.YEAR. COSTCO.CAPITAL ONE10.470.262-0.540.1530.15-0.1440.07-0.15510-0.280.02670.4-0.180.170.428-0.230.39-0.04-0.32100.750.28a) Calculate the average return and risk of each of them.b) If the returns follow a normal distribution, what is the probability that Walmart's returns are between6% and 8%?c) Build a set of portfolios with these returns, calculate their return, risk, construct the efficient frontiergraph and select a portfolio, explain your selection.

Step 1: Determine the average return on investment for all stocks.About Costco:Compile all of…

Answered: Consider the following stock price…

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

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The following table displays hypothetical stock quotations. Use the information in the table to answer the questions that follow. Listed Stock Quotes Company Ticker High Low Last Price* Net Change** YTD %*** Div. Yield P/E Ratio MarkMin MM 93.06 67.68 84.60 4.56 1.66 0 46 MarlRedBiro MRB 14.00 9.15 10.77 2.01 7.19 6.0 10 TStar TS 341.06 221.69 284.22 2.70 5.02 2.4 26 *Last price for the day **Net change in price from previous day ***Year-to-date percentage change in stock price Of the three stocks listed, a retiree who lives partially off of investment income would be best off holding because of its . You can calculate that MarkMin had per-share earnings for the most recent 12-month period of . If you had purchased 100 shares of TStar stock yesterday at the last price of the day, you would have of if you sold all 100 shares at the last price today.
A stock had the following year-end prices and dividends. What is the geometric average annual return on this stock Time Price Dividend 0 $23.19 ? 1 $24.90 $0.23 2 $23.18 $0.24 3 $24.86 $0.25
Use the information in the following stock quote to answer the question: As of February 1, 2XX1 Name Symbol Open High Low Close Net Chg Div Yield PE Target TGT 87.01 87.32 86.75 87.05 -0.32 2.56 2.93 16.76 What was Target’s earnings per share over the last year? (Round your answer to 2 decimal places. (e.g., 32.16))
Using the information in the table below, 1.Calculate the Price Earnings Ratio for both stocks. Share Price Per Share Stock X ($) 25 Earnings Per Share 2.00 Stock Y ($) 20 0.67 2. Interpret the results obtained in part above, by highlighting the implications for a firm of having a low P/E or a high P/E.
(Computing rates of return) From the following price data, compute the annual rates of return for Asman and Salinas. Time 1 2 3 12 4 14 (Click on the icon in order to copy its contents into a spreadsheet.) How would you interpret the meaning of the annual rates of return? Asman $9 11 Salinas $30 27 32 36 The rate of return you would have earned on Asman stock from time 1 to time 2 is %. (Round to two decimal places.)
Your rate of return expectations for the stock of Kayleigh Cosmetics Company during the next year are: KAYLEIGH COSMETICS CO. Possible Rate of Return Probability −0.60 ............0.15 −0.30 ............0.10 −0.10 ............0.05 0.20 ............0.40 0.40 ............0.20 0.80 ............0.10 a. Compute the expected return [E(Ri)] on this stock, the variance (σ2) of this return, and its standard deviation (σ).
An analyst gathered the following information for a stock and market parameters: stock beta= 1.08; • expected return on the Market = 11.97%; • expected return on T-bills = 1.55%; • current stock Price = $9.01; • expected stock price in one year = $11.14; • expected dividend payment next year = $3.23. Calculate the expected return for this stock. Please share your answer as a percentage rounded to 2 decimal places.
Suppose a stock had an initial price of $84 per share, paid a dividend of $1.50 per share during the year, and had an ending share price of $71.50. a. Compute the percentage total return. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What was the dividend yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What was the capital gains yield? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Find the annualized holding rate of return and the average rate of return for a stock that returned -30% in year 1 and +30% in year 2. Annualized holding rate of return = -7.00% A. -9.00% B. -15.00% C. 0.00%
Calculating Return Components An investor purchases one share of stock for $50. After one year, they sell the share for $55. During the year, they receive $7 in dividends. a) What was the dividend yield, in percentage terms? b) What was the capital gain from price appreciation on the stock, in percentage terms? c) What was the total return in dollars? What was the total return, in percentage terms?
Vinay
Suppose a stock had an initial price of $93 per share, paid a dividend of $2.40 per share during the year, and had an ending share price of $76.00. a. Compute the percentage total return. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What was the dividend yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What was the capital gains yield? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. b. Dividend yield Percentage total return C. Capital gains yield % % %

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