Question

In: Finance

Portfolio analysis You have been given the return data shown in the first table on three...

Portfolio analysis You have been given the return data shown in the first table on three assets—F, G, and H—over the period 2010–2013.

Expected return

Year Asset F Asset G Asset H

2010 16% 17% 14%

2011 17% 16% 15%

2012 18% 15% 16%

2013 19% 14% 17%

Using these assets, you have isolated the three investment alternatives shown in the following table:

Alternative Investment

1 100% of asset F

2 50% of asset F and 50% of asset G

3 50% of asset F and 50% of asset H

a. Calculate the expected return over the 4-year period for each of the three alternatives.

b. Calculate the standard deviation of returns over the 4-year period for each of the three alternatives.

c. Use your findings in parts a and b to calculate the coefficient of variation for each of the three alternatives.

d. On the basis of your findings, which of the three investment alternatives do you recommend? Why?

Solutions

Expert Solution


Related Solutions

Portfolio Analysis. You have been given the expected return data shown in the first table on...
Portfolio Analysis. You have been given the expected return data shown in the first table on three assets-F,G and H- over the period 2016-2019. Expected return Year          Asset F               Asset G             Asset H 2016         16%                    17%                    14% 2017          17                       16                       15 2018          18                        15                       16 2019           19                       14                       17 Using these assets, you have isolated the three investment alternatives shown in the following table: Alternative              Investment 1                            100% of asset F 2                            50% of asset F and 50% of asset G...
P8–14 Portfolio analysis You have been given the expected return data shown in the first table...
P8–14 Portfolio analysis You have been given the expected return data shown in the first table on three assets—F, G, and H—over the period 2016–2019. Expected return Year Asset F Asset G Asset H 2016 16% 17% 14% 2017 17 16 15 2018 18 15 16 2019 19 14 17 Alternative Investment 1 100% of asset F 2 50% of asset F and 50% of asset G 3 50% of asset F and 50% of asset H Asset Expected return,...
P8-14 Portfolio analysis You have been given the expected return data shown in the first table...
P8-14 Portfolio analysis You have been given the expected return data shown in the first table on three assets—F, G, and H—over the period 2016–2019 Expected return Year Asset F Asset G Asset H 2016 16% 17% 14% 2017 17 16 15 2018 18 15 16 2019 19 14 17 Using these assets, you have isolated the three investment alternatives shown in the following table. Alternative Investment 1 100% of asset F 2 50% of asset F and 50% of...
You have been given the expected return data shown in the first table on the three...
You have been given the expected return data shown in the first table on the three assets - F, G, and H - over the period 2016-2019 Expected Return Expected Return Expected Return Year Asset F Asset G Asset H 2016 16% 17% 14% 2017 17 16 15 2018 18 15 16 2019 19 14 17 Using these assets, you have isolated the three investment alternatives shown in the following table. Alternative Investment 1 100% of asset F 2 50%...
You have been given the expected return data shown in the first table on three assetslong...
You have been given the expected return data shown in the first table on three assetslong dash—​F, ​G, and Hlong dash—over the period​ 2016-2019: lick on the icon located on the​ top-right corner of the data table below in order to copy its contents into a​ spreadsheet.) Expected Return Year Asset F Asset G Asset H 2016 11​% 12%     9​%     2017 12​% 11% 10​% 2018 13% 10​% 11​% 2019 14​% 99% 12​% . Using these​ assets, you have isolated the...
you have been given the expected return data shown in the first table on three assetslong...
you have been given the expected return data shown in the first table on three assetslong dash—​F, ​G, and H long dash—over the period​ 2016-2019: Expected Return Year Asset F Asset G Asset H 2016 16​% 17​%     14​%     2017 17​% 16​% 15​% 2018 18​% 15​% 16​% 2019 19​% 14​% 17​% Using these​ assets, you have isolated the three investment alternatives shown in the following​ table Alternative Investment 1 ​100% of asset F 2 ​50% of asset F and​ 50% of...
you have been given the expected return data shown in the first table on three assetslong...
you have been given the expected return data shown in the first table on three assetslong dash—​F, ​G, and H long dash—over the period​ 2016-2019: Expected Return Year Asset F Asset G Asset H 2016 16​% 17​%     14​%     2017 17​% 16​% 15​% 2018 18​% 15​% 16​% 2019 19​% 14​% 17​% Using these​ assets, you have isolated the three investment alternatives shown in the following​ table Alternative Investment 1 ​100% of asset F 2 ​50% of asset F and​ 50% of...
You have been given the expected return data shown in the first table on three assets—F,...
You have been given the expected return data shown in the first table on three assets—F, G, and H—over the period 2015-2018 Year Asset F Asset G Asset H 2015 9 12 15 2016 8 9 16 2017 5 21 19 2018 13 6 11 Find the expected return, variance, std dev and coefficient of variation for each asset. Now consider a portfolio that consists of 25% of F, 50% of G and 25% of H. Find the expected return,...
You have been given the expected return data shown in the first table on three assets—F,...
You have been given the expected return data shown in the first table on three assets—F, G, and H—over the period 2015-2018 Year Asset F Asset G Asset H 2015 9 12 15 2016 8 9 16 2017 5 21 19 2018 13 6 11 Find the expected return, variance, std dev and coefficient of variation for each asset. Now consider a portfolio that consists of 25% of F, 50% of G and 25% of H. Find the expected return,...
You have been given the expected return data shown in the first table on three assets—F,...
You have been given the expected return data shown in the first table on three assets—F, G, and H—over the period 2015-2018 Year Asset F Asset G Asset H 2015 9 12 15 2016 8 9 16 2017 5 21 19 2018 13 6 11 Find the expected return, variance, std dev and coefficient of variation for each asset. Now consider a portfolio that consists of 25% of F, 50% of G and 25% of H. Find the expected return,...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT