Fin- correlation related multiple problems

 

Q1Based on the following information:

 

  

 

State of Economy

Probability of 
State of Economy

Rate of Return
if State Occurs

  Depression

.12

−.103

  Recession

.23

.061

  Normal

.47

.132

  Boom

.18

.213

 

  

 

Calculate the expected return. (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

 

  

 

  Expected return

[removed]  %

 

  

 

Calculate the standard deviation. (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

 

  

 

  Standard deviation

[removed]  %

 

 

 

Q2.Consider the following information:

 

  

 

 

 

Rate of Return if State Occurs

  State of

Probability of

  Economy

State of Economy

Stock A

Stock B

Stock C

  Boom

 

.15

 

 

.37

 

 

.47

 

 

.27

 

  Good

 

.45

   

.22

   

.18

   

.11

 

  Poor

 

.35

 

.04

 

.07

 

.05

 

  Bust

 

.05

 

.18

 

.22

 

.08

 

 

  

 

a.

Your portfolio is invested 20 percent each in A and C, and 60 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16))

 

 

 

  Expected return

[removed] %  

 

  

 

b1.

What is the variance of this portfolio? (Do not round intermediate calculations and round your answer to 5 decimal places. (e.g., 32.16161))

 

 

 

  Variance

[removed]  

   

 

 

 

b2.

What is the standard deviation? (Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16))

 

 

 

  Standard deviation

[removed] %  

 

 

 

 

 

Q3.Stock Y has a beta of 1.8 and an expected return of 18.2 percent. Stock Z has a beta of 0.8 and an expected return of 9.6 percent. If the risk-free rate is 5.2 percent and the market risk premium is 6.7 percent, the reward-to-risk ratios for stocks Y and Z are [removed] and [removed] percent, respectively. Since the SML reward-to-risk is [removed] percent

 

Q4. Based on the following information:

 

  

 

  State of
 Economy

Return on
Stock A

Return on
Stock B

  Bear

.107

−.050

  Normal

.110

.153

  Bull

.078

.238

 

  

 

Assume each state of the economy is equally likely to happen.

 

  

 

Calculate the expected return of each of the following stocks. (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16))

 

  

 

Expected return  

  Stock A

[removed]%

  Stock B

[removed]%

 

  

 

Calculate the standard deviation of each of the following stocks. (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16))

 

  

 

Standard deviation  

  Stock A

[removed]%

  Stock B

[removed]%

 

  

 

What is the covariance between the returns of the two stocks? (Negative amount should be indicated by a minus sign, Do not round intermediate calculation and round your final answer to 6 decimal places. (e.g., 32.161616))

 

  

 

  Covariance

[removed]  

 

  

 

What is the correlation between the returns of the two stocks? (Negative amount should be indicated by a minus sign, Do not round intermediate calculation round your final answer to 4 decimal places. (e.g., 32.1616))

 

  

 

  Correlation

[removed]  

 

Semester Papers
Calculate your paper price
Pages (550 words)
Approximate price: -

Why Work with Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

Professional and Experienced Academic Writers

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

24/7 Customer Support

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

Calculate the price of your order

Total price:
$0.00

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.

Essays

Essay Writing Service

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.

Admissions

Admission Essays & Business Writing Help

An admission essay is an essay or other written statement by a candidate, often a potential student enrolling in a college, university, or graduate school. You can be rest assurred that through our service we will write the best admission essay for you.

Reviews

Editing Support

Our academic writers and editors make the necessary changes to your paper so that it is polished. We also format your document by correctly quoting the sources and creating reference lists in the formats APA, Harvard, MLA, Chicago / Turabian.

Reviews

Revision Support

If you think your paper could be improved, you can request a review. In this case, your paper will be checked by the writer or assigned to an editor. You can use this option as many times as you see fit. This is free because we want you to be completely satisfied with the service offered.

error: Content is protected !!