expected return and risk (measured by standard deviation) a

Q: Define standard deviation

A: It refers to the variation in the actual observations from the average. Z-Score helps to know how…

Q: hich of the following would not be acceptable as a measure of basic investment risk? a)Expected…

A: Risk is always there when you invest in stock returns and risk is volatility of returns and change…

Q: What is the relationship of a portfolio standard deviation to the weighted average standard…

A: The standard deviation measures volatility of an investment or the risk of an investment. The…

Q: Find the variance &Standard deveation of the portfolio

A: Excel Spreadsheet:

Q: standard deviation of historical returns Market beta Tracking error risk Discuss in what scenario…

A: In financial terms, risk can be defined as the possibility that the real profits from an outcome or…

Q: isk can be separated into undiversifiable risk and diversifiable risk. Discuss the difference…

A: In market there are many types of risk involved but broadly there are two types of risk…

Q: What is the expected return on a two asset portfolio and what are its variance and standard…

A: Two Asset portfolio: The portfolio that has 2 assets is called as two asset portfolio.

Q: Morningstar's Risk-Adjusted Rating most closely resembles which measure? The Treynor Index Jensen's…

A: Financial statements are statements which states the business activities performed by the company .…

Q: The desired rate of return on an investment should reflect the degree of risk involved. A.   True…

A: Riskier investments may give higher returns to the investors as they provide favorable ratio of risk…

Q: Morningstar's Risk-Adjusted Rating most closely resembles which measure? The Treynor Index Jensen's…

A: Financial statements are statements which states the business activities performed by the company .…

Q: Define the following types of risk and provide a specific Wells G&H example for of each Perceived…

A: Risk is the situation that arises in the future where the expected outcome is not similar to the…

Q: When determining the riskiness of a stand-alone instrument (not included in a portfolio), which of…

A: The asset risk is classified into 2 terms  One is stand alone risk in which we consider  only the…

Q: What are quantitative measurements versus non-quantitative measurements with respect to risk?

A: Risk is used to describe the probability or uncertainty related to a future event with a favorable…

Q: Total risk can be divided into: standard deviation and variance. standard deviation and covariance.…

A: Risk is the probability of loss. It describes the chance that there will be a negative return or…

Q: beta value on risk-return ratio

A: The risk-return ratio measures the return in terms of risk for a specified period of time. The…

Q: Which of the following statements is true for compensation of risk? a. Higher the risk, lower is the…

A: The Statement for compensation of risk is as under-

Q: Which of the following is not recognized as a measurement of risk? O median Orange best case/worst…

A: Median and Range are not typically recognized as direct measurements of risk, while the other…

Q: Total risk is measured by _____ and systematic risk is measured by _____. Group of answer choices…

A: Risk and return are fundamental concepts that are closely intertwined. They represent the trade-off…

Q: The measures of risk include Geometric Mean Arithmetic Mean Median Variance

A: The risk is very important in the stock market and we must quantify the risk so that it can be…

Q: Describe the relation between Risk and Returns that was introduced by Harry Markowitz

A: Modern portfolio theory, or MPT, is referred to as the method for portfolio management for reducing…

Q: What information would be required to compute the risk-asset ratio under Basle I?

A: The risk asset ratio (RAR) measures the amount of a bank's total regulatory capital in relation to…

Q: Briefly define and give examples of each of the following components of total risk. Which type of…

A: Risk refers to the variability of returns. It is the possibility or the likelihood that the actual…

Q: Describe the process of using the risk-adjusted discount rateto calculate the net present value?

A: Net present value (NPV) is the excess of present value of cash inflows over the present value of…

Q: Beta is which of the following: A) standard deviation. B) total risk. C) Beta is the relationship…

A: option C is correct  Beta is the relationship which is between an investment's return, and the…

Q: Which is riskier lower IRR or a higher IRR? Please explain and incorporate differences in risk based…

A: According to the internal rate of return (IRR) rule, a project or investment should be undertaken if…

Q: Which of the following are measurements of risk? range coefficient of variation mean average…

A: The measurements of risk are range, coefficient of variation, standard deviation, and median.…

Q: What is definitions of this?   Systematic risk  Risk free rate of return  Market rate of…

A: Capital asset pricing model (CAPM) can be used to compute the return expected by the investors by…

Q: Compare and contrast systematic and unsystematic risk and how it affects a portfolio.

A: Risk in a portfolio refers to the likelihood of losing money or not achieving the desired returns on…

Q: The expected return of a portfolio is simply the weighted average of the expected returns for the…

A: When investors create a portfolio of assets, one of the key metrics of interest is the expected…

Q: he variance of expected returns is equal to the square root of the expected returns. a. True b.…

A: Formula for variance:S2=∑(Xi-X̄) 2/n S2=VarianceXi=Value of one observationX̄=Mean value of all…

Q: How does the application of the standard deviation differ from the application of the coefficient of…

A: a. Standard Deviation: The average fluctuation of a variable around the mean is known as standard…

Q: Discuss the Beta of  as measure of systematic risk.

A: In finance systematic risk refers to that risk which is inherent to the entire market. As the risk…

Q: Is the portfolio risk the weighted average of the variance or covariance?

A: The concept of variance which states the deviation from the total average or which is said to be the…

Q: What is standard deviation? What type of risk does it measure

A: Standard deviation measures the risk of an investment regarding how it will fluctuate or deviate…

Q: ow does standard deviation and variance affect portfolio risk, more so than expected return?

A: The standard deviation is  statistical  m ea s u r e of the amount of variation from the average or…