You believe that there is a 20% chance that Astro company’s share will drop by 11%...

You believe that there is a 20% chance that Astro company’s share will drop by 11% and 80% chance that it will increase by 17%. In addition, there is a 25% chance that OCK Group Berhad company’s share will drop by 15% and a 75% chance that it will increase by 24%. The covariance is 0.009.

Calculate the expected return, the variance, the standard deviation, and the correlation for each share.

Expert Solution

Given information

Astro company

probability changes in share %

20%. -11%

80%. 17%

ock group company

probability. changes in share %

25%. -15%

75%. 24%

jeff jeffy answered 2 years ago

You believe Orange, Inc. stock has a 20% chance of making 11%, a 30% chance of...

You believe Orange, Inc. stock has a 20% chance of making 11%, a 30% chance of making 16% and a 50% chance of losing 6%. What is the standard deviation of Orange, Inc. stock return? 10.15% 32.82% 13.73% 4.36%

7. What option strategy would be best if you believe there is a good chance for...

7. What option strategy would be best if you believe there is a good chance for either large gains or large losses in the underlying stock over the next 6 months? Justify your answer.

In the following year, there is a 10% chance of a bear market, a 20% chance...

In the following year, there is a 10% chance of a bear market, a 20% chance of a bull market, and a 70% chance of a neutral market. Debt will return -2%, 5%, and 5% in the bear, bull and neutral market, respectively. Equity will return -15%, 15%, and 8% in the bear, bull and neutral market , respectively . What is the expected return of debt in %? (round to 1 decimal place) What is the volatility of equity in...

Astro Corporation was started with the issue of 5,300 shares of $11 par stock for cash...

Astro Corporation was started with the issue of 5,300 shares of $11 par stock for cash on January 1, 2018. The stock was issued at a market price of $20 per share. During 2018, the company earned $58,050 in cash revenues and paid $38,894 for cash expenses. Also, a $3,300 cash dividend was paid to the stockholders. Required: Prepare an income statement, statement of changes in stockholders’ equity, balance sheet, and statement of cash flows for Astro Corporation’s 2018 fiscal...

You want to sell a Google share. You believe that Google’s share price is currently too low.

You want to sell a Google share. You believe that Google’s share price is currently too low. You would sell the Google share if its price is at least 2% above the current level. What type of order should you place?a limit buy ordera market sell ordera limit sell ordera market buy order

Your investment has a 20% chance of earning a 26% rate of return, a 50% chance...

Your investment has a 20% chance of earning a 26% rate of return, a 50% chance of earning a 15% rate of return and a 30% chance of losing 9%. What is your expected return on this investment? Enter answer in percents, accurate to two decimal places.

State whether you believe fantasy sports in cricket is skills-based or chance-based and why using the...

State whether you believe fantasy sports in cricket is skills-based or chance-based and why using the information and data within this case.

?Acquirer Company’s management believes that there is a 70 percent chance that Target Company’s free cash...

?Acquirer Company’s management believes that there is a 70 percent chance that Target Company’s free cash flow to the firm will grow at 25 percent per year during the next five years from this year’s level of $4 million. Sustainable growth beyond the fifth year is estimated at 5 percent per year. However, they also believe that there is a 30 percent chance that cash flow will grow at half that annual rate during the next five years and then...

Many track hurdlers believe that they have a better chance of winning if they start in...

Many track hurdlers believe that they have a better chance of winning if they start in the inside lane that is closest to the field. For the data below, the lane closest to the field is Lane 1, the next lane is Lane 2, and so on until the outermost lane, Lane 6. The data lists the number of wins for track hurdlers in the different starting positions. Calculate the chi-square test statisticΛ20 to test the claim that the probabilities...

1. You own a share in Red Hat. Every period it has a 15 percent chance...

1. You own a share in Red Hat. Every period it has a 15 percent chance of going bankrupt. The interest rate is 0. If it survives to the end of the first period, it will pay $2 in dividends, $3 in dividends at the end of the second period, $3 in dividends at the end of the third period, and $4 in dividends at the end of the fourth period. It will pay no dividends after the end of...

Question