Question
In: Finance
A global equity manager is assigned to select stocks from a universe of large stocks throughout...
A global equity manager is assigned to select stocks from a universe of large stocks throughout the world. The manager will be evaluated by comparing her returns to the return on the MSCI World Market Portfolio, but she is free to hold stocks from various countries in whatever proportions she finds desirable. Results for a given month are contained in the following table:
| Country | Weight
In MSCI Index |
Manager’s Weight |
Manager’s Return in Country |
Return of Stock
Index for That Country |
|||||||||
| U.K. | 0.3 | 0.26 | 22 | % | 15 | % | |||||||
| Japan | 0.43 | 0.2 | 17 | 17 | |||||||||
| U.S. | 0.22 | 0.21 | 10 | 13 | |||||||||
| Germany | 0.05 | 0.33 | 7 | 15 | |||||||||
a. Calculate the total value added of all the manager’s decisions this period. (Do not round intermediate calculations. Round your answer to 2 decimal places. Negative amount should be indicated by a minus sign.)
Added Value=
b. Calculate the value added (or subtracted) by her country allocation decisions. (Do not round intermediate calculations. Round your answer to 2 decimal places. Negative amount should be indicated by a minus sign.)
Contribution of country allocation=
c. Calculate the value added from her stock selection ability within countries. (Do not round intermediate calculations. Round your answer to 2 decimal places. Negative amount should be indicated by a minus sign.)
Contribution of stock selection=
Solutions
jeff jeffy answered 1 year agoRelated Solutions
A global equity manager is assigned to select stocks from a universe of large stocks throughout...
A global equity manager is assigned to select stocks from a
universe of large stocks throughout the world. The manager will be
evaluated by comparing her returns to the return on the MSCI World
Market Portfolio, but she is free to hold stocks from various
countries in whatever proportions she finds desirable. Results for
a given month are contained in the following table:
Country
Weight In
MSCI Index
Manager’s
Weight
Manager’s Return
in Country
Return of Stock Index
for That...
A global equity manager is assigned to select stocks from a universe of large stocks throughout...
A global equity manager is assigned to select stocks from a
universe of large stocks throughout the world. The manager will be
evaluated by comparing her returns to the return on the MSCI World
Market Portfolio, but she is free to hold stocks from various
countries in whatever proportions she finds desirable. Results for
a given month are contained in the following table:
Country
Weight In
MSCI Index
Manager’s
Weight
Manager’s Return
in Country
Return of Stock Index
for That...
A global equity manager is assigned to select stocks from a universe of large stocks throughout...
A global equity manager is assigned to select stocks from a
universe of large stocks throughout the world. The manager will be
evaluated by comparing her returns to the return on the MSCI World
Market Portfolio, but she is free to hold stocks from various
countries in whatever proportions she finds desirable. Results for
a given month are contained in the following table:
Country
Weight In
MSCI Index
Manager’s
Weight
Manager’s Return
in Country
Return of Stock Index
for That...
A global equity manager is assigned to select stocks from a universe of large stocks throughout...
A global equity manager is assigned to select stocks from a
universe of large stocks throughout the world. The manager will be
evaluated by comparing her returns to the return on the MSCI World
Market Portfolio, but she is free to hold stocks from various
countries in whatever proportions she finds desirable. Results for
a given month are contained in the following table:
Country
Weight In
MSCI Index
Manager’s
Weight
Manager’s Return
in Country
Return of Stock Index
for That...
A global equity manager is assigned to select stocks from a universe of large stocks throughout...
A global equity
manager is assigned to select stocks from a universe of large
stocks throughout the world. The manager will be evaluated by
comparing her returns to the return on the MSCI World Market
Portfolio, but she is free to hold stocks from various countries in
whatever proportions she finds desirable. Results for a given month
are contained in the following table:
Country
Weight
In
MSCI Index
Manager’s
Weight
Manager’s Return
in Country
Return of Stock
Index
for That...
A global equity manager is assigned to select stocks from a universe of large stocks throughout...
A global equity manager is assigned to select stocks from a
universe of large stocks throughout the world. The manager will be
evaluated by comparing her returns to the return on the MSCI World
Market Portfolio, but she is free to hold stocks from various
countries in whatever proportions she finds desirable. Results for
a given month are contained in the following table: Country Weight
In MSCI Index Manager’s Weight Manager’s Return in Country Return
of Stock Index for That...
A global equity manager is assigned to select stocks from a universe of large stocks throughout...
A global equity manager is assigned to select stocks from a
universe of large stocks throughout the world. The manager will be
evaluated by comparing her returns to the return on the MSCI World
Market Portfolio, but she is free to hold stocks from various
countries in whatever proportions she finds desirable. Results for
a given month are contained in the following table: Country Weight
In MSCI Index Manager’s Weight Manager’s Return in Country Return
of Stock Index for That...
A global equity manager is assigned to select stocks from a universe of large stocks throughout...
A global equity manager is assigned to select stocks from a
universe of large stocks throughout the world. The manager will be
evaluated by comparing her returns to the return on the MSCI World
Market Portfolio, but she is free to hold stocks from various
countries in whatever proportions she finds desirable. Results for
a given month are contained in the following table:
Country
Weight In
MSCI Index
Manager’s
Weight
Manager’s Return
in Country
Return of Stock Index
for That...
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