Sheet 5 Use Sheet 5 to complete the following Date GOOG Return NFLX Return Market Return Risk-Free Return GOOG Excess Return* NFLX Excess Return* Market Excess Return* 3/1/2017 0.7700 4.0000 3.7200 0.0050 0.2700 3.5000 3.2200 4/1/2017 9.2100 2.9700 -0.0400 0.0050 8.7100 2.4700 -0.5400 5/1/2017 6.5000 7.1400 0.9100 0.0050 6.0000 6.6400 0.4100 6/1/2017 -5.8200 -8.3800 1.1600 0.0050 -6.3200 -8.8800 0.6600 7/1/2017 2.4000 21.5800 0.4800 0.0050 1.9000 21.0800 -0.0200 8/1/2017 0.9500 -3.8300 1.9300 0.0050 0.4500 -4.3300 1.4300 9/1/2017 2.1100 3.8000 0.0500 0.0050 1.6100 3.3000 -0.4500 10/1/2017 6.0000 8.3200 1.9300 0.0050 5.5000 7.8200 1.4300 11/1/2017 0.4700 -4.5100 2.2200 0.0050 -0.0300 -5.0100 1.7200 12/1/2017 2.4500 2.3400 2.8100 0.0050 1.9500 1.8400 2.3100 1/1/2018 11.8100 40.8100 0.9800 0.0050 11.3100 40.3100 0.4800 2/1/2018 -5.5700 7.8000 5.6200 0.0050 -6.0700 7.3000 5.1200 3/1/2018 -6.6000 1.3600 -3.8900 0.0050 -7.1000 0.8600 -4.3900 4/1/2018 -1.4000 5.7900 -2.6900 0.0050 -1.9000 5.2900 -3.1900 5/1/2018 6.6500 12.5300 0.2700 0.0050 6.1500 12.0300 -0.2300 6/1/2018 2.8300 11.3300 2.1600 0.0050 2.3300 10.8300 1.6600 7/1/2018 9.1100 -13.7900 0.4800 0.0050 8.6100 -14.2900 -0.0200 8/1/2018 0.0800 8.9600 3.6000 0.0050 -0.4200 8.4600 3.1000 9/1/2018 -2.0300 1.7500 3.0300 0.0050 -2.5300 1.2500 2.5300 10/1/2018 -9.7800 -19.3400 0.4300 0.0050 -10.2800 -19.8400 -0.0700 11/1/2018 1.6400 -5.1900 -6.9400 0.0050 1.1400 -5.6900 -7.4400 12/1/2018 -5.3700 -6.4600 1.7900 0.0050 -5.8700 -6.9600 1.2900 1/1/2019 7.8000 26.8400 -9.1800 0.0050 7.3000 26.3400 -9.6800 2/1/2019 0.3200 5.4800 7.8700 0.0050 -0.1800 4.9800 7.3700 3/1/2019 4.7700 -0.4300 2.9700 0.0050 4.2700 -0.9300 2.4700 4/1/2019 1.2900 3.9200 1.7900 0.0050 0.7900 3.4200 1.2900 5/1/2019 -7.1400 -7.3600 3.9300 0.0050 -7.6400 -7.8600 3.4300 6/1/2019 -2.0600 7.0000 -6.5800 0.0050 -2.5600 6.5000 -7.0800 7/1/2019 12.5600 -12.0700 6.8900 0.0050 12.0600 -12.5700 6.3900 8/1/2019 -2.3500 -9.0500 1.3100 0.0050 -2.8500 -9.5500 0.8100 9/1/2019 2.6000 -8.9000 -1.8100 0.0050 2.1000 -9.4000 -2.3100 10/1/2019 3.3700 7.3900 1.7200 0.0050 2.8700 6.8900 1.2200 11/1/2019 3.5600 9.4800 2.0400 0.0050 3.0600 8.9800 1.5400 12/1/2019 2.4600 2.8300 3.4000 0.0050 1.9600 2.3300 2.9000 1/1/2020 7.2700 6.6500 2.8600 0.0050 6.7700 6.1500 2.3600 SECTION 3 Average Excess Return Std. Deviation of Return Beta Covariance**
Sheet 5 Use Sheet 5 to complete the following Date GOOG Return NFLX Return Market Return Risk-Free Return GOOG Excess Return* NFLX Excess Return* Market Excess Return* 3/1/2017 0.7700 4.0000 3.7200 0.0050 0.2700 3.5000 3.2200 4/1/2017 9.2100 2.9700 -0.0400 0.0050 8.7100 2.4700 -0.5400 5/1/2017 6.5000 7.1400 0.9100 0.0050 6.0000 6.6400 0.4100 6/1/2017 -5.8200 -8.3800 1.1600 0.0050 -6.3200 -8.8800 0.6600 7/1/2017 2.4000 21.5800 0.4800 0.0050 1.9000 21.0800 -0.0200 8/1/2017 0.9500 -3.8300 1.9300 0.0050 0.4500 -4.3300 1.4300 9/1/2017 2.1100 3.8000 0.0500 0.0050 1.6100 3.3000 -0.4500 10/1/2017 6.0000 8.3200 1.9300 0.0050 5.5000 7.8200 1.4300 11/1/2017 0.4700 -4.5100 2.2200 0.0050 -0.0300 -5.0100 1.7200 12/1/2017 2.4500 2.3400 2.8100 0.0050 1.9500 1.8400 2.3100 1/1/2018 11.8100 40.8100 0.9800 0.0050 11.3100 40.3100 0.4800 2/1/2018 -5.5700 7.8000 5.6200 0.0050 -6.0700 7.3000 5.1200 3/1/2018 -6.6000 1.3600 -3.8900 0.0050 -7.1000 0.8600 -4.3900 4/1/2018 -1.4000 5.7900 -2.6900 0.0050 -1.9000 5.2900 -3.1900 5/1/2018 6.6500 12.5300 0.2700 0.0050 6.1500 12.0300 -0.2300 6/1/2018 2.8300 11.3300 2.1600 0.0050 2.3300 10.8300 1.6600 7/1/2018 9.1100 -13.7900 0.4800 0.0050 8.6100 -14.2900 -0.0200 8/1/2018 0.0800 8.9600 3.6000 0.0050 -0.4200 8.4600 3.1000 9/1/2018 -2.0300 1.7500 3.0300 0.0050 -2.5300 1.2500 2.5300 10/1/2018 -9.7800 -19.3400 0.4300 0.0050 -10.2800 -19.8400 -0.0700 11/1/2018 1.6400 -5.1900 -6.9400 0.0050 1.1400 -5.6900 -7.4400 12/1/2018 -5.3700 -6.4600 1.7900 0.0050 -5.8700 -6.9600 1.2900 1/1/2019 7.8000 26.8400 -9.1800 0.0050 7.3000 26.3400 -9.6800 2/1/2019 0.3200 5.4800 7.8700 0.0050 -0.1800 4.9800 7.3700 3/1/2019 4.7700 -0.4300 2.9700 0.0050 4.2700 -0.9300 2.4700 4/1/2019 1.2900 3.9200 1.7900 0.0050 0.7900 3.4200 1.2900 5/1/2019 -7.1400 -7.3600 3.9300 0.0050 -7.6400 -7.8600 3.4300 6/1/2019 -2.0600 7.0000 -6.5800 0.0050 -2.5600 6.5000 -7.0800 7/1/2019 12.5600 -12.0700 6.8900 0.0050 12.0600 -12.5700 6.3900 8/1/2019 -2.3500 -9.0500 1.3100 0.0050 -2.8500 -9.5500 0.8100 9/1/2019 2.6000 -8.9000 -1.8100 0.0050 2.1000 -9.4000 -2.3100 10/1/2019 3.3700 7.3900 1.7200 0.0050 2.8700 6.8900 1.2200 11/1/2019 3.5600 9.4800 2.0400 0.0050 3.0600 8.9800 1.5400 12/1/2019 2.4600 2.8300 3.4000 0.0050 1.9600 2.3300 2.9000 1/1/2020 7.2700 6.6500 2.8600 0.0050 6.7700 6.1500 2.3600 SECTION 3 Average Excess Return Std. Deviation of Return Beta Covariance**
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
Related questions
Concept explainers
Risk and return
Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary.
Capital Asset Pricing Model
Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.
Question
100%
Sheet 5
Use Sheet 5 to complete the following
Date | GOOG Return | NFLX Return | Market Return | Risk-Free Return | GOOG Excess Return* | NFLX Excess Return* | Market Excess Return* | |
3/1/2017 | 0.7700 | 4.0000 | 3.7200 | 0.0050 | 0.2700 | 3.5000 | 3.2200 | |
4/1/2017 | 9.2100 | 2.9700 | -0.0400 | 0.0050 | 8.7100 | 2.4700 | -0.5400 | |
5/1/2017 | 6.5000 | 7.1400 | 0.9100 | 0.0050 | 6.0000 | 6.6400 | 0.4100 | |
6/1/2017 | -5.8200 | -8.3800 | 1.1600 | 0.0050 | -6.3200 | -8.8800 | 0.6600 | |
7/1/2017 | 2.4000 | 21.5800 | 0.4800 | 0.0050 | 1.9000 | 21.0800 | -0.0200 | |
8/1/2017 | 0.9500 | -3.8300 | 1.9300 | 0.0050 | 0.4500 | -4.3300 | 1.4300 | |
9/1/2017 | 2.1100 | 3.8000 | 0.0500 | 0.0050 | 1.6100 | 3.3000 | -0.4500 | |
10/1/2017 | 6.0000 | 8.3200 | 1.9300 | 0.0050 | 5.5000 | 7.8200 | 1.4300 | |
11/1/2017 | 0.4700 | -4.5100 | 2.2200 | 0.0050 | -0.0300 | -5.0100 | 1.7200 | |
12/1/2017 | 2.4500 | 2.3400 | 2.8100 | 0.0050 | 1.9500 | 1.8400 | 2.3100 | |
1/1/2018 | 11.8100 | 40.8100 | 0.9800 | 0.0050 | 11.3100 | 40.3100 | 0.4800 | |
2/1/2018 | -5.5700 | 7.8000 | 5.6200 | 0.0050 | -6.0700 | 7.3000 | 5.1200 | |
3/1/2018 | -6.6000 | 1.3600 | -3.8900 | 0.0050 | -7.1000 | 0.8600 | -4.3900 | |
4/1/2018 | -1.4000 | 5.7900 | -2.6900 | 0.0050 | -1.9000 | 5.2900 | -3.1900 | |
5/1/2018 | 6.6500 | 12.5300 | 0.2700 | 0.0050 | 6.1500 | 12.0300 | -0.2300 | |
6/1/2018 | 2.8300 | 11.3300 | 2.1600 | 0.0050 | 2.3300 | 10.8300 | 1.6600 | |
7/1/2018 | 9.1100 | -13.7900 | 0.4800 | 0.0050 | 8.6100 | -14.2900 | -0.0200 | |
8/1/2018 | 0.0800 | 8.9600 | 3.6000 | 0.0050 | -0.4200 | 8.4600 | 3.1000 | |
9/1/2018 | -2.0300 | 1.7500 | 3.0300 | 0.0050 | -2.5300 | 1.2500 | 2.5300 | |
10/1/2018 | -9.7800 | -19.3400 | 0.4300 | 0.0050 | -10.2800 | -19.8400 | -0.0700 | |
11/1/2018 | 1.6400 | -5.1900 | -6.9400 | 0.0050 | 1.1400 | -5.6900 | -7.4400 | |
12/1/2018 | -5.3700 | -6.4600 | 1.7900 | 0.0050 | -5.8700 | -6.9600 | 1.2900 | |
1/1/2019 | 7.8000 | 26.8400 | -9.1800 | 0.0050 | 7.3000 | 26.3400 | -9.6800 | |
2/1/2019 | 0.3200 | 5.4800 | 7.8700 | 0.0050 | -0.1800 | 4.9800 | 7.3700 | |
3/1/2019 | 4.7700 | -0.4300 | 2.9700 | 0.0050 | 4.2700 | -0.9300 | 2.4700 | |
4/1/2019 | 1.2900 | 3.9200 | 1.7900 | 0.0050 | 0.7900 | 3.4200 | 1.2900 | |
5/1/2019 | -7.1400 | -7.3600 | 3.9300 | 0.0050 | -7.6400 | -7.8600 | 3.4300 | |
6/1/2019 | -2.0600 | 7.0000 | -6.5800 | 0.0050 | -2.5600 | 6.5000 | -7.0800 | |
7/1/2019 | 12.5600 | -12.0700 | 6.8900 | 0.0050 | 12.0600 | -12.5700 | 6.3900 | |
8/1/2019 | -2.3500 | -9.0500 | 1.3100 | 0.0050 | -2.8500 | -9.5500 | 0.8100 | |
9/1/2019 | 2.6000 | -8.9000 | -1.8100 | 0.0050 | 2.1000 | -9.4000 | -2.3100 | |
10/1/2019 | 3.3700 | 7.3900 | 1.7200 | 0.0050 | 2.8700 | 6.8900 | 1.2200 | |
11/1/2019 | 3.5600 | 9.4800 | 2.0400 | 0.0050 | 3.0600 | 8.9800 | 1.5400 | |
12/1/2019 | 2.4600 | 2.8300 | 3.4000 | 0.0050 | 1.9600 | 2.3300 | 2.9000 | |
1/1/2020 | 7.2700 | 6.6500 | 2.8600 | 0.0050 | 6.7700 | 6.1500 | 2.3600 | |
SECTION 3 | Average Excess Return | |||||||
Std. Deviation of Return | ||||||||
Beta | ||||||||
Covariance** |
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