The value of the shares in the S&P 500 index is $12,2708. Apple Inc. is the largest company in the index-it is worth $552.158. If you want to build a portfolio that earns the same return as the S&P 500, what is the portfolio weight on Apple? 4.5% O 3.5% O 5.5% O 6.5 %

The value of the shares in the S&P 500 index is $12,2708. Apple Inc. is the largest company in the index-it is worth $552.158. If you want to build a portfolio that earns the same return as the S&P 500, what is the portfolio weight on Apple? 4.5% O 3.5% O 5.5% O 6.5 %

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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Vcast Inc., is expected to grow at a constant rate of 6 percent will pay a dividend of $2.75 next year. The current market price of the stock is $47. If investors require a return of 12% on similar stocks, how much is the stock worth and is the current market price a good buy? No, it is not a good buy because the stock is worth $45.83 Yes, it is a good buy because the stock is worth $45.83 O No, it is not a good buy because the stock is worth $39.29 O yes, it is a good buy because the stock is worth $39.29
Suppose Stella invests $20,000 in Facebook stock, and $30,000 in HoneywellInternational stock. She expects a return of 16% for Facebook and 10% for Honeywell. Whatis her portfolio’s expected return? Round your answer to two decimal places.A. 11.50%B. 12.40%C. 13.00%D. 13.60%E. 14.50%
you have invested in two shares, Tinkle.com and Circumbendibus Wheels. Tinkle.com has volatility 38.20%, while Circumbendibus Wheels has volatility 35.90%. The correlation between the two shares' returns is 0.44. You have allocated 50.00% of your money to Tinkle.com. What is the volatility of your portfolio?
National Advertising just paid a dividend of D0 = $0.75 per share, and that dividend is expected to grow at a constant rate of 6.50% per year in the future. The company's beta is 1.25, the required return on the market is 10.50%, and the risk-free rate is 4.50%. What is the company's current stock price? a. $14.52 b. $14.89 c. $15.26 d. $15.64 e. $16.03
The share price of a company is shs100. Its expected next dividend is shs3. The dividend and share price growth rate is expected to be 4% p.a. The risk-free interest rate is 5% p.a. The share has a beta of 0.8 and the expected yield on the stock market as a whole is 8% p.a. Use the Gordon Growth Model and the Security Market Line to form an opinion as to whether the share is correctly priced.
Please fast answer. Your company is considering an issue of preference shares. The market is currently expecting a return of 7 percent and your company expects earnings per share to be $10.10 and the dividend for preferenceshares to be $1.40. i) What will be the issue price of a preference share? $20
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An investor holds a diversified portfolio consisting of a P2,100 investment in each of 10 different common stocks. The portfolio beta is equal to 1.5. You have decided to sell one of your stocks, whose beta is equal to 1, for P2,100 and used the proceeds to buy different P2,100 of stock of a retail company whose beta is 1.2. What will be the new beta of the portfolio? (No rounding off until the final answer)
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