The figure in the popup window.. shows the one-year return distribution for RCS stock. Calcula a. The expected return. b. The standard deviation of the return. Note: Make sure to round all intermediate calculations to at least five decimal places. Graph/chart Probability (%) 35- 30- 25- 20- 15 10- 5 0 -20% -10% 0% Return 10% 20% - Q Q 2 X

The figure in the popup window.. shows the one-year return distribution for RCS stock. Calcula a. The expected return. b. The standard deviation of the return. Note: Make sure to round all intermediate calculations to at least five decimal places. Graph/chart Probability (%) 35- 30- 25- 20- 15 10- 5 0 -20% -10% 0% Return 10% 20% - Q Q 2 X

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 figure in the popup window, a. The expected return. b. The standard deviation of the return. Note: Make sure to round all intermediate calculations to at least five decimal places. Graph/chart Probability (%) 35- 30- 25- 20 15- 10- 5 9 -25% shows the one-year return distribution for RCS stock. Calculate -10% 0% Return 10% 25% - Q Q 2 X
Consider the rate of return of stocks ABC and XYZ. Year 1 2 3 4 ABC XYZ ABC 22% 9 19 1 O ABC Ⓒ XYZ ABC XYZ Required: a. Calculate the arithmetic average return on these stocks over the sample period. (Do not round Intermediate calculations. Round your answers to 2 decimal places.) XYZ 38% 11 19 -11 Arithmetic Average b. Which stock has greater dispersion around the mean return? c. Calculate the geometric average returns of each stock. (Do not round Intermediate calculations. Round your answers to 2 decimal places.) Expected rate of return 11.40 % 11.40 % Geometric Average Expected rate of return d. If you were equally likely to earn a return of 22%, 9%, 19%, 6%, or 1%, in each year (these are the five annual returns for stock ABC), what would be your expected rate of return? (Do not round Intermediate calculations. Round your answers to 2 decimal places.) e. What if the five possible outcomes were those of stock XYZ? (Do not round Intermediate calculations. Round your answers to 2…
Current Attempt in Progress To achieve a zero standard deviation for a portfolio, calculate the weights of stock A and stock B, assuming the correlation coefficient is-1. Use the following information. (Round intermediate calculations and final answers to 2 decimal places, e.g. 31.21%.) State of the economy Probability of Expected return on Expected return on occurrence stock A in this state stock B in this state High growth 30% 41.5% 56.5% Moderate growth 25% 21.5% 26.5% Recession 45% -11.5% -21.5% Weight of stock A % Weight of stock B %
Colonel Motors (C) Separated Edison (S) Expected Return 10% 8% Standard Deviation 6% 3% Please represent graphically all potential combinations of stocks C and S, if the correlation coefficient between the returns of stocks C and S is: A) 1 B) 0 C) -1 Please report these investment opportunity sets in the corresponding Excel sheets.
Use the following information: Stock A B Good state 10% 14% Bad state 2% -2% Assume there is 60% probability that the good state occurs and 40% chance the bad state occurs. What is the standard deviation of stock A? (Please use 5 decimal places, this should be written in percentage, so an answer of 23.143% should be written as .23143)
Consider the following returns and states of the economy for TZ.Com.: Economy ProbabilityReturn Weak 15% Normal 50% Strong 35% -9% 2% 6% What is the standard deviation of TZ's returns? SET YOUR CALCULATOR TO FOUR DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE %. FOR EXAMPLE, IF YOUR ANSWER IS 7.7011% ENTER IT AS 7.70.
Refer to the table below: 3 Doors, Inc. Down Co. Expected return, E(R) Standard deviation, o Correlation 15% 10% 30 18 0.39 Using the Information provided on the two stocks in the table above, find the expected return and standard deviation on the minimum variance portfolio. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Expected return % Standard deviation %
Using the following information, calculate the expected return and the standard deviation of Metlock. (Round intermediate calculations to 4 decimal places, e.g. 15.2564 and the final answers to 2 decimal places, e.g. 15.25%.) State of the Metlock stock economy Probability return (%) Depression 0.10 -4.9 Recession 0.15 1.0 Normal 0.40 5.9 Boom 0.35 17.9 Expected return Standard deviation % di do %
Q4: Assume the following information for stocks A and B. • Expected return on Stock A = 18%. • Expected return on Stock B = 23%. • Correlation between returns of Stock A and Stock B = 0.10. • Standard deviation of returns on Stock A = 40%. • Standard deviation of returns on Stock B = 50%. Compute The expected return Standard deviation
Am. 387.
Assignant. How to use real Dato to draw the Efficient Frontier? Step: Choose 2 Stocks collect Date for 1 year (daily) Prices Colorlate Returns (daily returns) Pt+1 - Pt Pt R 7,41 STEP 2 6 。Comporte the Expected Return for each stock E(R) = Average Return = Σ Ri - • Compte Risk (6;) => √2 (2:-R)2 R mpute the CORR between the 2 stocks Compute Comply for cov) for

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