Choose two publicly traded stocks and fill in their tickers to cells B3 and B4 of FrontSheet.For your chosen stocks, work out the following tasks.1. On sheet Q1, compute the weekly returns of the chosen stocks over the last 150 weeks(prior to 22nd April 2024).2. For each stock, plot a histogram of its returns.3. Estimate the means, variances and the correlation of the two stocks. (If the computedcorrelation is 1 or -1, please choose a different set of stocks for all questions.)4. Calculate the value at risk of the returns at confidence level 95% of each stock.5. Plot the efficient frontier of a portfolio consisting of the two chosen stocks.6. Suppose that the weekly interest rate is 0.1%. Calculate the Sharpe ratio of this port-folio.7. How does the Sharpe ratio of such portfolio change if the weekly interest rate decreases?Justify your answer by numerical evidences.

To accomplish these tasks, we will need access to specific financial data and tools typically found…

Answered: Choose two publicly traded stocks and…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter13: Regression And Forecasting Models

Section: Chapter Questions

Problem 41P

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Analyzing and Reporting Financial Statement Effects of Bond Transactions On January 1 of the current year, Banek Inc. issued $700,000 of 8%, nine-year bonds for $618,173, which implies a market (yield) rate of 10%. Semiannual interest is payable on June 30 and December 31 of each year. a. Show Excel inputs to confirm the bond issue price. Note: Round your answer to two decimal places. rate= nper= pmt= FV= 0.05 18 (28,000) (700,000) ▼ Answer = $ 125,901.16 * b. Indicate the financial statement effects using the template for (1) bond issuance, (2) semiannual interest payment and discount amortization on June 30 of the current year, and (3) semiannual interest payment and discount amortization on December 31 of the current year. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Note: Round your…
To better plan for future growth of the restaurant, Karen needs to develop a system that will enable her to forecast food and beverage sales by month for up to one year in advance. Table shows the value of food and beverage sales ($1000s) for the first three years of operation. Food and Beverage Sales for the Vintage Restaurant ($1000s) Month First Year Second Year Third Year January 242 263 282 February 235 238 255 March 232 247 265 April 178 193 205 May 184 193 210 June 140 149 160 July 145 157 166 August 152 161 174 September 110 122 126 October 130 130 148 November 152 167 173 December 206 230 235 Managerial Report Perform an analysis of the sales data for the Vintage Restaurant. Prepare a report for Karen that summarizes your findings, forecasts, and recommendations. Include the following: A time series plot. Comment on the underlying pattern in the time series.…
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The average return for large-cap domestic stock funds over the three years 2009-2011 was 14.6%. Assume the three-year returns were normally distributed across funds with a standard deviation of 4.8%. a. What is the probability an individual large-cap domestic stock fund had a three-year return of at least 20% (to 4 decimals)? b. What is the probability an individual large-cap domestic stock fund had a three-year return of 10% or less (to 4 decimals)? c. How big does the return have to be to put a domestic stock fund in the top 10% for the three-year period (to 2 decimals)? %
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