Annual and Average Returns for Stocks, Bonds, and T-Bills, 1950 to 2017 1950 to 2017 Average 1950 to 1959 1960 to 1969 1970 to 1979 1980 to 1989 1990 to 1999 2000 to 2009 Average Average Average Average Average Average 2010 Annual Return 2011 Annual Return 2012 Annual Return 2013 Annual Return 2014 Annual Return 2015 Annual Return. 2016 Annual Return 2017 Annual Return 2010 to 2017 Average Stocks 12.7% 20.9 8.7 7.5 18.2 19.0 0.9 15.1 2.1 16.0 32.4 13.7 1.4 12.0 21.8 14.3 Portfolio Return Long-Term Treasury Bonds 6.6% 0.0 1.6 5.7 13.5 9.5 8.0 9.4 29.9 3.6 -12.7 25.1 -1.2 1.2 8.4 8.0 T-bills 4.30% 2.00 4.00 6.30 8.90 4.90 2.70 0.01 0.02 0.02 0.07 0.05 0.21 0.51 1.39 0.29 You have a portfolio with an asset allocation of 47 percent stocks, 30 percent long-term Treasury bonds, and 23 percent T-bills. Use these weights and the returns given in the above table to compute the return of the portfolio in the year 2010 and each year since. Then compute the average annual return and standard deviation of the portfolio. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
Annual and Average Returns for Stocks, Bonds, and T-Bills, 1950 to 2017 1950 to 2017 Average 1950 to 1959 1960 to 1969 1970 to 1979 1980 to 1989 1990 to 1999 2000 to 2009 Average Average Average Average Average Average 2010 Annual Return 2011 Annual Return 2012 Annual Return 2013 Annual Return 2014 Annual Return 2015 Annual Return. 2016 Annual Return 2017 Annual Return 2010 to 2017 Average Stocks 12.7% 20.9 8.7 7.5 18.2 19.0 0.9 15.1 2.1 16.0 32.4 13.7 1.4 12.0 21.8 14.3 Portfolio Return Long-Term Treasury Bonds 6.6% 0.0 1.6 5.7 13.5 9.5 8.0 9.4 29.9 3.6 -12.7 25.1 -1.2 1.2 8.4 8.0 T-bills 4.30% 2.00 4.00 6.30 8.90 4.90 2.70 0.01 0.02 0.02 0.07 0.05 0.21 0.51 1.39 0.29 You have a portfolio with an asset allocation of 47 percent stocks, 30 percent long-term Treasury bonds, and 23 percent T-bills. Use these weights and the returns given in the above table to compute the return of the portfolio in the year 2010 and each year since. Then compute the average annual return and standard deviation of the portfolio. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
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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Transcribed Image Text:Annual and Average Returns for Stocks, Bonds, and T-Bills, 1950 to 2017
1950 to 2017 Average
1950 to 1959 Average
1960 to 1969
Average
Average
1970 to 1979
Average
1980 to 1989
1990 to 1999
Average
2000 to 2009
Average
Annual Return
2010
2011 Annual Return
2012 Annual Return
2013 Annual Return
2014 Annual Return
2015 Annual Return
2016 Annual Return
2017
Annual Return
2010 to 2017 Average
2010
Portfolio Return
Stocks
12.7%
20.9
8.7
7.5
%
18.2
19.0
0.9
15.1
2.1
16.0
32.4
13.7
1.4
12.0
21.8
14.3
Long-Term Treasury
Bonds
6.6%
0.0
1.6
5.7
13.5
9.5
8.0
9.4
29.9
3.6
You have a portfolio with an asset allocation of 47 percent stocks, 30 percent long-term Treasury bonds, and 23
percent T-bills. Use these weights and the returns given in the above table to compute the return of the portfolio in
the year 2010 and each year since. Then compute the average annual return and standard deviation of the portfolio.
(Do not round intermediate calculations. Round your answers to 2 decimal places.)
-12.7
25.1
-1.2
1.2
8.4
8.0
T-bills
4.30%
2.00
4.00
6.30
8.90
4.90
2.70
0.01
0.02
0.02
0.07
0.05
0.21
0.51
1.39
0.29
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