Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

The following table provides the share return forecasts and associated probabilities for Advanced Limited and Bright Limited.

Advanced Limited Bright Limited
Return (%) Probability (%) Return (%) Probability (%)
15.5 30 20.3 20
12 30 10.5 50
9.5 40 7 30

a. find out the expected return on each share.

b. find out the variance and standard deviation for each share.

c. Suppose a portfolio comprised of 60% investment in Advanced Limited and 40% investment in Bright Limited can be constructed.
An analyst has estimated that the correlation coefficient of the two-asset portfolio is -0.50, find out the return and standard deviation of this portfolio. and draw your conclusion.

 

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M927187

Have any Question? 


Related Questions in Basic Finance

1 describe the basic types of regional trade agreements

1. Describe the basic types of regional trade agreements. Discuss some of the advantages and disadvantages of MNCs doing business in each type. 2. Discuss some of the implications (costs and benefits) of a common currenc ...

What are the various ways in which an individual may obtain

What are the various ways in which an individual may obtain the right to go on to the floor of an exchange and trade futures? What are daily price limits, and why are they used? What are circuit breakers? What are their ...

Suppose chapman corporation is planning to pay a 2 per

Suppose Chapman Corporation is planning to pay a $2 per share dividend to its common stockholders. If the common stock price after the ex-dividend date is $50, what was the stock price before the ex-dividend date? $50 $5 ...

A hedge fund is currently engaged in a plain vanilla euro

A hedge fund is currently engaged in a plain vanilla euro swap in which it pays euros at the euro floating rate of Euribor and receives euros fixed. It would like to convert this position into one in which it pays the re ...

1 why should investors review their personal financial

1. Why should investors review their personal financial circumstances from time to time? 2. Why is asset allocation important? 3. List the strategies for increasing returns on a bond portfolio. 4. What are the tools of a ...

A an investor buys european call on a share for sh 5 the

a) An investor buys European call on a share for sh 5. The share price is sh 90 and the strike price is sh 85. Under which circumstances does the investor make profit? When will the option be exercised? Draw a diagram to ...

Introduction to corporate finance case work sources of

Introduction to Corporate Finance Case Work: Sources of Finance The task is to analyze available sources of finance for a selected SME entity. (1 SME company) What sources of finance are available for the selected entity ...

Discussioncourse wrap-up please respond to the

Discussion "Course Wrap-Up" Please respond to the following: • Imagine you have completed your bachelor's degree at Strayer and you are searching for a job in finance, accounting or business. Using various employment web ...

Groupe danone is one of the largest food companies in the

Groupe Danone is one of the largest food companies in the world. It is the leading food company in France, Italy and Spain. It is ranked third in Europe and seventh worldwide. In Italy, Danone has invested more in probio ...

Suppose you own 50000 shares of stock valued at 3550 per

Suppose you own 50,000 shares of stock valued at $35.50 per share. You are interested in protecting it with a put that would have a delta of 0.62. Assume, however, that the put is not available or is unfairly priced. Ill ...

  • 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