a. What is the expected return of each asset? b. What is the variance and the standard deviation of each asset? c. What is the expected return of a portfolio with 8% in asset J, 51% in asset K, and 41% in asset L? d. What is the portfolio's variance and standard deviation using the same asset weights from part (c)? Hint: Make sure to round all intermediate calculations to at least seven (7) decimal places. The input instructions, phrases in parenthesis after each answer box, apply for the answers you will type. Data Table of (Click on the following icon in order to copy its contents into a spreadsheet.) Return on Asset J in Return on Return on State of Probability of State Asset K in Economy Boom Asset L in State State State 0.28 0.070 0.220 0.140 0.280 Growth 0.39 0.070 0.070 0.070 0.200 Stagnant Recession ncut 0.22 0.065 0.075 0.11 0.120 -0.220

a. What is the expected return of each asset? b. What is the variance and the standard deviation of each asset? c. What is the expected return of a portfolio with 8% in asset J, 51% in asset K, and 41% in asset L? d. What is the portfolio's variance and standard deviation using the same asset weights from part (c)? Hint: Make sure to round all intermediate calculations to at least seven (7) decimal places. The input instructions, phrases in parenthesis after each answer box, apply for the answers you will type. Data Table of (Click on the following icon in order to copy its contents into a spreadsheet.) Return on Asset J in Return on Return on State of Probability of State Asset K in Economy Boom Asset L in State State State 0.28 0.070 0.220 0.140 0.280 Growth 0.39 0.070 0.070 0.070 0.200 Stagnant Recession ncut 0.22 0.065 0.075 0.11 0.120 -0.220

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

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Expected return and standard deviation. Use the following information to answer the questions: a. What is the expected return of each asset? b. What is the variance and the standard deviation of each asset? c. What is the expected return of a portfolio with 12% in asset J, 52% in asset K, and 36% in asset L? d. What is the portfolio's variance and standard deviation using the same asset weights from part (c)? Hint: Make sure to round all intermediate answers you will type. a. What is the expected return of asset J? (Round to four decimal places.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Return on Asset J in State of Economy Boom Growth Stagnant Recession Probability of State 0.24 0.36 0.21 0.19 State 0.050 0.050 0.050 0.050 Return on Asset K in State 0.230 0.120 0.020 -0.060 Return on Asset L in State 0.250 0.190 0.065 - 0.190
Expected retun and standard deviation. Use the following information to answer the questions: a. What is the expected return of each asset? b. What is the variance and the standard deviation c. What is the expected return of a portfolio with 1 1 Data Table d. What is the portfolio's variance and standard de - X Hint Make sure to round all intermediate calculatio Swers yo (Click on the following icon D in order to copy its contents into a spreadsheet.) a. What is the expected return of asset J? (Round to four decimal places.) Return on Return on Return on Probability of State State of Asset J in Asset Kin State 0.200 0.140 0.040 Asset L in Economy State State Вoom 0.28 0.070 0.260 0.180 Growth 0.37 0.25 0.070 Stagnant 0.070 0.060 -0.210 Recession 0.10 0.070 -0.100 Print Done
b. What is the variance of this portfolio? The standard deviation? Please show me all steps of the calculations.
What is the expected return on a two asset portfolio and what are its variance and standard deviation? Also, What is R squared?
assume that every asset has the same expected return and variance. furthermore, all assets have the same covariance with each other. as number of assets in a portfolio grows, which becomes more important: variance or covariance? clarify your answer using words, diagrams, formulae or a practical example.
The appropriate measure of risk used in Sharpe's measure of portfolio evaluation is a. Range b. Variance c. Beta d. Standard deviation
The expected rate of return of an investment ________. a. equals one of the possible rates of return for that investment b. equals the required rate of return for the investment c. is the mean value of the probability distribution of possible returns d. is the median value of the probability distribution of possible returns e. is the mode value of the probability distribution of possible returns
Please find the following: The investment's expected return as a percentage: The investment's standard deviation:
What is the expected return on a two asset portfolio and what are its variance and standard deviation. What is R squared? Please keep it short and simple but making lots of sense. thanks
Suppose the gain from an investment is a normal random variable with mean 2 and standard deviation1.25. Compute the VaR for this investment.
Given the following probability distribution for assets X and Y, compute the expected rate of return, variance, standard deviation, and coefficient of variation for the two assets. Which asset seems to be a better investment?
Compute the residual risk measure for portfolio A. Round off your final answer to three digits after the decimal point. Compute the appraisal ratio for portfolio B. Round off your final answer to three digits after the decimal point.

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