What is the required rate of return on the new portfolio?

Q: process

A: The optimal portfolio for any investor would include both risk free assets & risky assets. The…

Q: How does the creation of a portfolio reduce risk? What type of assets should be included in a…

A: Introduction Portfolio: Any combination of financial assets, such as stocks, bonds, and currency, is…

Q: What is growth option?

A: Mutual funds have two types of schemes. Growth option and dividend option. Mutual funds having…

Q: What is the expected return on a portfolio? How can the expected return on a portfolio be…

A: Expected Return on Portfolio  =( Weights of Stock 1 * Return of Stock 1) + ( Weights of Stock 2 *…

Q: Critically discuss the effect of diversification on portfolio risk. Is there any limit of…

A: A portfolio is the mixture of securities managed by the portfolio manager. We can take the amount in…

Q: What is Long-Term Equity AnticiPation Security (LEAPS)?

A: Long-term equity anticipation securities (LEAPS) It's a contract for trading on open market options…

Q: theory

A: Portfolio theory is a mathematical framework that helps investors optimize their investment…

Q: What are the benefits and advantages of diversification for a portfolio?

A: Diversification of portfolio means allocating investments to different assets so that there is…

Q: Given the capital allocation line, an investor's optimal complete portfolio is the portfolio that A)…

A: Capital Allocation Line (or CAL) refers to that line in finance that shows risk and reward profile…

Q: Conceptually, how does an investor choose his or her optimal portfolio?

A: The point where any of the ‘indifference curve’ are tangent to the efficient set of portfolios is…

Q: What is the relation between the expected rate of return and the required rate of return as they…

A: In the world of finance in general and investments in particular we often look at a security’s…

Q: What is the expected return on a portfolio? How can the expected return on a portfolio be…

A:

Q: 1. What are some fixed-income portfolio benchmarks available and why are they used?

A: Market-capitalization-weighted indices like Citigroup World Government Bond Index and Barclays…

Q: how to calculate portfolio beta?

A: Beta is used while calculating the volatility of the investment. It measures the systematic risk of…

Q: What is the Capital Asset Pricing Model (CAPM)? Derive the risk premium when beta is between 0 and…

A: Stock valuation is a quantitative approach that an analyst or management of the company undergoes…

Q: What can be understood from active portfolio?

A: There are two strategies or approaches which can be used in management of portfolios which are…

Q: What is relationship between the returns on an asset and returns in the whole mark

A: A market portfolio is a theoretical concept that means a portfolio that consists of all the stocks…

Q: How do you perceive the relationship between risk and return in the context of investment…

A: The relationship between risk and return is a fundamental concept in finance and investment. In…

Q: When will the prime rate go up and what factors drive it?

A: The prime rate is the best interest rate you can get, and it's influenced by the economy.   In order…

Q: Draw the profit diagram of the portfolio just drawn (and clearly state any assumptions you make).…

A: In the original solution, the payoff diagram and the payoff equation were determined. Now, the…

Q: Calculate Portfolio Returns with example?

A: The determination of profit or loss on the investment in a portfolio is called portfolio return. The…

Q: what do you learn from this analysis including factors to be considered in choosing a preferred…

A: The portfolio consist of all the securities that is existed and traded . The portfolio consist of…

Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.