b) Reuel Capital case studyJoseph Mhofu is a fixed income portfolio manager for Reuel Capital. Mhofu is reviewing theportfolios of several pension clients that have been assigned to him to manage. Two of theseportfolios are Woodlands Groove and LETS pension plan has the following characteristics:SectorSingapore treasurySingapore agenciesSingapore CorporatesSingapore mortgagesSingapore ABSWoodlandsGrooveAllocation(ii)LETSAllocation10.1%14.5%20.9%33.7%8.20%12.6%LETSDuration7.549.024.521.3314.6%23.7%13.8%11.4%18.0%Non-Singapore governments 18.5%Bond index benchmark for Woodlands Groove bond portfolio has an effective duration of 4.16.(1) Calculate the duration of Woodlands Groove bond portfolio and asses the interest rate riskof the portfolio versus the benchmark.WoodlandsGroove SpreadDuration2.003.220.007.205.804.653.672.50Calculate the spread duration of LETS pension plan portfolio and evaluate the credit risk ofthe portfolio versus the Singapore mortgages.

Several securities have been provided with their duration and spread duration. Two portfolios have…

Answered: Joseph Mhofu is a fixed income…

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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__________ fund is defined as one in which the fund charges a sales commission to either buy into or exit from the fund. Group of answer choices A no-load A specialized sector A load An index
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In class we learnt about the broad classifications of financial markets. How will you explain any three of these classifications to your friends in history department?2. Why are financial markets so keenly regulated? Explain the rational for the regulation of financial markets in Ghana, providing cogent examples of such regulations within the Ghanaian financial market.3. Describe the requirements for listing on the Ghana Alternative Exchange (GAX) relative to the first official listing requirements.4. Expatiate on the role of participants in the primary and secondary mortgage market. Provide examples within the Ghanaian context.5. Explain the difference between debt to income (DTI) ratio and loan to value ratio (LTV). In addition, mention in which scenario the mortgage is likely to be insured, (a) High or low DTI ( b). High or low LTV.6. Expound on the arguments in favour and against financial innovation. Provide examples of financial innovation within any country of choice.7. A. Nii…
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Two depository institutions have composite CAMELS ratings of 1 or 2 and are "well capitalized." Thus, each institution falls into the FDIC Risk Category I deposit insurance assessment scheme. Further, the institutions have the following financial ratios and CAMELS ratings: Use Table 13–11. Institution A Institution B Tier I leverage ratio (%) 8.80 7.93 Net income before taxes/risk-weighted assets (%) 2.33 1.95 Nonperforming loans and leases/gross assets (%) 0.53 0.68 Other real estate owned/gross assets (%) 0.15 0.45 Brokered deposits/total assets (%) 3.75 1.05 One year asset growth 7.35 4.65 Loans as a Percentage of Total Assets: Construction & Development 0.00 0.00 Commercial & Industrial 18.36 11.40 Leases 2.05 1.75 Other Consumer 18.85 18.55 Loans to Foreign Government 0.30 0.30 Real Estate Loans Residual 0.00 0.00…
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