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
Question
What is the likely frequency of the data (daily, monthly, yearly)? Compare to historical historical data in the picture to justify the answer.

Transcribed Image Text:The last ten observations of the holding period returns (HPR) of stock XYZ are given in the
following table:
Period
1234567
7
8
9
10
XYZ
-3%
2%
6%
-5%
-10%
10%
3%
7%
0%
-3%

Transcribed Image Text:TABLE 4.4
Australia
Belgium
Canada
Denmark
Finland
France
Germany
Ireland
HISTORICAL RETURNS FOR MAJOR ASSET CLASSES (1900–2017)
Average Annual Rates of Return
Long-Term
Government Bonds
Italy
Japan
Netherlands
New Zealand
Norway
South Africa
Spain
Sweden
Switzerland
Stocks
12.2%
10.2%
10.2%
11.4%
16.4%
13.0%
13.4%
11.0%
14.2%
14.5%
10.3%
11.8%
11.0%
14.7%
11.5%
11.5%
8.4%
11.2%
11.5%
9.6%
6.1%
5.9%
Short-Term
Government Bills
4.5%
4.7%
4.5%
5.9%
6.5%
4.7%
3.4%
4.8%
4.3%
4.7%
3.4%
5.4%
4.8%
6.1%
5.9%
5.2%
2.9%
4.8%
3.8%
3.8%
5.6%
7.5%
7.4%
7.4%
5.3%
6.5%
7.3%
6.7%
4.9%
6.2%
5.9%
7.3%
8.0%
6.6%
4.7%
United Kingdom
6.2%
United States
5.3%
World
5.3%
(Source: Data from Credit Suisse Global Investment Returns Yearbook 2018.)
Inflation
3.8%
6.0%
3.1%
3.9%
8.6%
7.4%
5.3%
4.3%
10.3%
9.8%
2.9%
3.7%
3.9%
5.2%
5.7%
3.5%
2.3%
3.9%
3.0%
3.0%
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