Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

1) Task of best stock solutions:

Renee is considering investing in 3 various stocks or creating three different 2 stock portfolios. Renee considers herself to be the conservative investor. She is able to get forecasted returns for 3 securities for years 2013 through 2019. Data are as given below:

Year   Stock A  Stock B  Stock C
 2013  10%      10%      12%
 2014  13%      11%      14%
 2015  15%       8%       10%
 2016  14%      12%      11%
 2017  16%      10%       9%
 2018  14%      15%       9%
 2019  12%      15%       10%

In Any of the 2 likely stock portfolios, weight of each stock in portfolio will be= 50%. Three possible portfolio combinations are= AB, AC, BC.
Carry out the following:

i) Make a spreadsheet to reply the following problems?

ii) Compute expected return for each individual stock .

iii) Compute the standard Deviation for each individual stock.

iv) Compute expected returns for portfolio AB, AC, BC.

iv) Compute standard Deviations for portfolios AB, AC, BC

v) Would you suggest that Jane invest in single stock A or portfolio consisting of stocks A and B? Describe your reply from the risk return view point.

vi) Would you suggest that Jane invest in single stock B or the portfolio consisting of stocks B and C? Describe your reply from a risk return view point.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M914856

Have any Question? 


Related Questions in Basic Finance

1 financial ratios are used extensively in annual reports

1. Financial ratios are used extensively in annual reports to interpret and explain financial statements. Comment. 2. List the sections of annual reports where ratios are most frequently located, in order of use. 3. Acco ...

Ne at least three ways to reduce the possibility of scc

Name at least three ways to reduce the possibility of SCC ? Which is better, a relatively small anode or a large one and why? Is coating a fastener always helpful in fighting corrosion resistance, even if there are minor ...

Suppose there are two risky assets c and d the tangency

Suppose there are two risky assets, c and d, the tangency portfolio is 60% c and 40% d, and the expected return and standard deviation of the return on the tangency portfolio are 5% and 7%, respectively. Suppose also tha ...

1 when are tests of simple main effects used and what do

1. When are tests of simple main effects used, and what do researchers learn from them? 2. Who developed the rationale and computations for the analysis of variance? 3. Under what two circumstances would you use a multiv ...

A scheme for the removal of h2s from a gas stream by

A scheme for the removal of H 2 S from a gas stream by scrubbing with water at 293 K and 1.013×10 5  Pa is being considered. The liquid will initially contain 3.7 mol % H 2 S. It is desired that the exiting gas stream co ...

Discuss the financial performance of the starbucks over the

Discuss the financial performance of the Starbucks over the past three years.

Toynbspcorpnbspis analyzing its optimal capital structure

Toy Corp. is analyzing its optimal capital structure. Currently, Toy's capital structure includes 10% debt and the company is planning to triple (3x) its debt capitalization.  Assume that the current risk-free rate is 3. ...

1 what is behavioral research what are its fundamental

1. What is behavioral research? What are its fundamental goals and limitations? Why is learning about behavioral research important? 2. In what ways is behavioral research similar to and different from research in the na ...

1 what is meant by loan servicing2 identify the principal

1. What is meant by loan servicing? 2. Identify the principal sources of mortgage company income. 3. How does the Farm Credit System structure the various agencies that handle oversight of the farm mortgage lending funct ...

Crypton electronics has a capital structure consisting of

Crypton Electronics has a capital structure consisting of 41% common stock and 59% debt. A debt issue of $100 0par value, 5.8% bonds that mature in 15years and pay annual interest will sell for $975. Common stock of the ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen