Question
In: Finance
Year Stock A's Returns Stock B's Returns 2014 -18.0% -14.5% 2015 33.0% 21.8% 2016 15.0% 30.5%...
Year Stock A's Returns Stock B's Returns
2014 -18.0% -14.5%
2015 33.0% 21.8%
2016 15.0% 30.5%
2017 -0.50% -7.6%
2018 27.0% 26.3%
a) Calculate the average rate of return for each stock during
the period 2014 through 2018.
b) Assume that someone held a portfolio consisting of 50% of
Stock A and 50% of stock B. What would the average return on the
portfolio have been each year?
c) What would the average return on the portfolio have been
during this period?
d) Calculate the standard deviation of returns for each stock
and for the portfolio.
e) Calculate the coefficient of variation for each stock and
for the portfolio.
f) Assuming you are a risk-averse investor, would you prefer
to hold Stock A, Stock B, or the portfolio? Why?
Solutions
Expert Solution
Ans:- we will use the excel function to find the answer easily.
Note:- If this answer helps you pls give thumbs up.
jeff jeffy answered 2 years agoRelated Solutions
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns:
Year
Stock A's Returns,
rA
Stock B's Returns,
rB
2011
- 22.40%
- 15.60%
2012
27.75
19.70
2013
10.00
37.00
2014
- 5.00
- 9.90
2015
23.75
2.90
a. Calculate the average rate of return for stock A during the
period 2011 through 2015. Round your answer to two decimal
places.
%_________
Calculate the average rate of return for stock B during the period
2011 through 2015. Round your answer to...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns:
Year
Stock A's Returns,
rA
Stock B's Returns,
rB
2014
(16.20
%)
(13.00
%)
2015
33.50
24.10
2016
15.00
30.90
2017
(1.75
)
(9.60
)
2018
27.25
25.40
Calculate the average rate of return for each stock during the
period 2014 through 2018. Round your answers to two decimal places.
Stock A: %
Stock B: %
Assume that someone held a portfolio consisting of 50% of Stock
A and 50% of Stock B....
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns: Year Stock
A's Returns, rA Stock B's Returns, rB 2013 - 19.40% - 17.90% 2014
37.75 23.80 2015 15.25 35.70 2016 - 5.50 - 6.70 2017 26.25
19.45
A. Calculate the average rate of return for stock A during the
period 2013 through 2017. Round your answer to two decimal places.
%
Calculate the average rate of return for stock B during the
period 2013 through 2017. Round your answer to...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns:
Year Stock A's Returns, rA Stock B's Returns, rB
2014 (18.50 %) (13.50%)
2015 32.50 19.90
2016 16.75 25.50
2017 (5.00 ) (12.70 )
2018 27.50 34.05
a. Calculate the average rate of return for each stock during
the period 2014 through 2018. Round your answers to two decimal
places.
Stock A: % Stock B: %
b. Assume that someone held a portfolio consisting of 50% of
Stock A and 50%...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns:
Year
Stock A's Returns, rA
Stock B's Returns, rB
2013
- 23.10%
- 16.70%
2014
39.25
28.30
2015
16.50
37.90
2016
- 1.75
- 7.70
2017
26.25
15.35
a Calculate the average rate of return for stock A during the
period 2013 through 2017. Round your answer to two decimal
places.
Calculate the average rate of return for stock B
during the period 2013 through 2017. Round your answer to...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns:
Year
Stock A's Returns, rA
Stock B's Returns, rB
2011
- 23.90%
- 12.00%
2012
24.75
27.40
2013
11.75
38.40
2014
- 1.25
- 6.50
2015
24.75
-11.20
Calculate the average rate of return for stock A during the
period 2011 through 2015. Round your answer to two decimal
places.
%
Calculate the average rate of return for stock B during the period
2011 through 2015. Round your answer to two...
REALIZED RATES OF RETURN Stocks A and B have the following historical returns: Year Stock A's...
REALIZED RATES OF RETURN
Stocks A and B have the following historical returns:
Year
Stock A's Returns, rA
Stock B's Returns, rB
2011
- 15.90%
- 16.50%
2012
33.50
21.20
2013
11.25
31.60
2014
- 6.00
- 8.80
2015
34.00
29.35
Calculate the average rate of return for stock A during the
period 2011 through 2015. Round your answer to two decimal
places.
%
Calculate the average rate of return for stock B during the period
2011 through 2015. Round...
Pinnacle Manufacturing Company Income Statement For the Year ended December 31 2016 2015 2014 ...
Pinnacle Manufacturing
Company
Income Statement
For the Year ended December 31
2016
2015
2014
Net sales
$150,737,628
$148,586,037
$144,686,413
Cost of goods sold
109,284,780
106,255,499
101,988,165
Gross profit
41,452,848
42,330,538
42,698,248
Operating expenses
37,177,738
38,133,969
37,241,108
Income from
operations
4,275,110
4,196,569
5,457,140
Other revenues and gains
—
—
—
Other expenses and losses
2,181,948
2,299,217
2,397,953
Income before income tax
2,093,162
1,897,352
3,059,187
Income tax
883,437
858,941
1,341,536
Net income for the year
1,209,725
1,038,411...
1. Consider a stock with the following return information for 2015-2020 Year Return 2015 25% 2016 ...
1. Consider a stock with the following return information for
2015-2020
Year Return
2015 25%
2016 -15%
2017 3%
2018 41%
2019 -6%
2020 12%
Find the following for your sample of returns: Average Return,
Variance, and Standard Deviation.
2. Jamie’s portfolio consists of $15,000 in Microsoft stock and
$45,000 in Coca Cola. Microsoft has an expected return of 19%
annually with a standard deviation of 42%. Coca Cola has an
expected return of 10% annually with a standard deviation...
year stock A stock B 2015 3 % 40% 2016 5 % -5% 2017 1 %...
year stock A stock B
2015 3 % 40%
2016 5 % -5%
2017 1 % 30%
2018 10 % -10%
2019 6 % 35 %
(1) Determine the correlation coefficient of returns of stocks A
and B. Can you reduce risk by creating a portfolio of the
combination of both stocks? why or why not?
(2) if you invest 80% of money in stock A and another 20% in
stock B, calculate expected rate of return and standard deviation...
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