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TOUR FEACK Do bonds reduce the overal risk of an investment portfolio? Let x be a random variable representing annual percent return for Vanguard Total Stock tndes (all stocks). Let y be a random variable representing annual return for Vanguard Balanced Index (60% stock and 40% band). For the past several years, we have the folwing data *: 36 0 13 24 22 32 2s -19 y 17 -9 24 18 10 9 9 -22 -19 -1 -7 -1 A USE SALT (0) Compute Dx, L, Ly, Xy. (b) Use the results of pert (a) to compute the sample mean, variance, and standard deviation for v and for y. (Round your answers to four deimal paces) () Compute the coefficient of variation for each fund. (Round your answers to the nearest whole number CV Use the coeficients of variation to compare the two funds. For each unit of return, the stock fund (x) has lower risk. Ofer each unit of return, the balanced fund (v) has lower rik For each unit of returm, the funds have equal sk. ir s regresents risks and represents expected returm, then s/x can be thought of as a measure of rsk per unit of expected retum, In this cane why is a smaler CV better Eglan A smaler CV is better because it indicates a higher risk per unit of expected return. A smaler CVis better because it indicates a lower risk per unit of expected return

TOUR FEACK Do bonds reduce the overal risk of an investment portfolio? Let x be a random variable representing annual percent return for Vanguard Total Stock tndes (all stocks). Let y be a random variable representing annual return for Vanguard Balanced Index (60% stock and 40% band). For the past several years, we have the folwing data *: 36 0 13 24 22 32 2s -19 y 17 -9 24 18 10 9 9 -22 -19 -1 -7 -1 A USE SALT (0) Compute Dx, L, Ly, Xy. (b) Use the results of pert (a) to compute the sample mean, variance, and standard deviation for v and for y. (Round your answers to four deimal paces) () Compute the coefficient of variation for each fund. (Round your answers to the nearest whole number CV Use the coeficients of variation to compare the two funds. For each unit of return, the stock fund (x) has lower risk. Ofer each unit of return, the balanced fund (v) has lower rik For each unit of returm, the funds have equal sk. ir s regresents risks and represents expected returm, then s/x can be thought of as a measure of rsk per unit of expected retum, In this cane why is a smaler CV better Eglan A smaler CV is better because it indicates a higher risk per unit of expected return. A smaler CVis better because it indicates a lower risk per unit of expected return

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
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ASA TUURIEACE Do bonds reduce the overal risk of an investment portfolio? Let x be a random variable representing annual percent return for Vanguard Total Stock Index (all stocks). Let y be a random variable representing annual return for Vanguard Balanced Index (60% stock and 40% bond). For the past several years, we have the following data. *: 36 0 13 24 22 32 2s -19 -22 -19 y: 17 -9 24 18 10 9 9 -1 -7 -1 A USE SALT (a) Compute Ex, Le, Ey, Sy. (b) Use the results of part (a) to compute the sample mean, variance, and standard deviation forx and for y. (Round your answers to four decimal paces) (c) Compute the coefficient of variation for each fund. (Round your answers to the nearest whole number) Use the coefcients of variation to compare the two funds. For each unit of return, the stock und (x) has lower nisk. For each unit of return, the balanced fund (v) has lower rik For each unit of retum, the funds have equal risk. ars represents risks andxrepresents expected retum, then s/K can be thought of as a measure of nsk per unit of expected retum, In this cane, why is a smaller CV better Exglan A smaller CV is better because t indicates a higher risk per unit of expected return. A smaller CV is better because it indicates a lower risk per unit of expected return
Transcribed Image Text:ASA TUURIEACE Do bonds reduce the overal risk of an investment portfolio? Let x be a random variable representing annual percent return for Vanguard Total Stock Index (all stocks). Let y be a random variable representing annual return for Vanguard Balanced Index (60% stock and 40% bond). For the past several years, we have the following data. *: 36 0 13 24 22 32 2s -19 -22 -19 y: 17 -9 24 18 10 9 9 -1 -7 -1 A USE SALT (a) Compute Ex, Le, Ey, Sy. (b) Use the results of part (a) to compute the sample mean, variance, and standard deviation forx and for y. (Round your answers to four decimal paces) (c) Compute the coefficient of variation for each fund. (Round your answers to the nearest whole number) Use the coefcients of variation to compare the two funds. For each unit of return, the stock und (x) has lower nisk. For each unit of return, the balanced fund (v) has lower rik For each unit of retum, the funds have equal risk. ars represents risks andxrepresents expected retum, then s/K can be thought of as a measure of nsk per unit of expected retum, In this cane, why is a smaller CV better Exglan A smaller CV is better because t indicates a higher risk per unit of expected return. A smaller CV is better because it indicates a lower risk per unit of expected return
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