Use Bartman Industries’ and Reynolds Incorporated’s stock prices and dividends, along with the Market Index, shown below for the period 1997-2002 to answer the following questions   Bartman Industries Reynolds Incorporated

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
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Use Bartman Industries’ and Reynolds Incorporated’s stock prices and dividends, along with the Market Index, shown below for the period 1997-2002 to answer the following questions

 

Bartman Industries

Reynolds Incorporated

 

Year

Stock  Price

Div

Stock  Price

Div

Market Returns

2002

$17.250

$1.150

$48.750

$3.000

11,663.98

2001

14.750

1.060

52.300

2.900

8,785.70

2000

16.500

1.000

48.750

2.750

8,676.98

1999

10.750

0.950

57.250

2.500

6,434.03

1998

11.375

0.900

60.000

2.250

5,602.28

1997

7.625

0.850

55.750

2.000

4,705.97

 

Required:                                                                                                            

1. Use the data given to calculate annual returns for Bartman, Reynolds, and the Market Index, and then calculate average returns over the 5-year period. (Hint: Remember, returns are calculated by subtracting the beginning price from the ending price to get the capital gain or loss, adding the dividend to the capital gain or loss, and dividing the result by the beginning price. Assume that dividends are already included in the index. Also, you cannot calculate the rate of return for 1997 because you do not have 1996 data.)

 

2. Calculate the standard deviations of the returns for Bartman, Reynolds, and the Market Index.

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