PLEASE ANSWER ALL QUESTIONS!!!!!!!!
NOTE: For SHARP RATIO, assume the risk free rate to be 0
PLEASE ROUND TO 2 DECIMALS! THANK YOU
AVERAGES
sp500 A B Average -0.0069
0.0018
0.0015
covariance matrix:
Sp500 A B Sp500 0.00336 A 0.00322 0.0041 B 0.0044 0.00514 0.00824
For a portfolio formed by 40% in the SP500 and 60% in A. Calculate the return on the portfolio.
8.) Using the covariance matrix from question 7, calculate the variance of the portfolio formed by 40% in the SP500 and 60% in A.
9.) Using the variance from question 8, calculate the standard deviation of the portfolio formed by 40% in the SP500 and 60% in A.
10.) Using the average and standard deviation from previous questions, calculate the Sharpe ratio for the portfolio formed by 40% in the SP500 and 60% in A.
11.) Using the averages from question 7, calculate the average of a portfolio formed by 30% in A and 70% in B.
12.) Using the covariance matrix from question 7, calculate the variance of a portfolio formed by 30% in A and 70% in B.
13.) Using the variance from question 12, calculate the standard deviation for the portfolio formed by 30% in A and 70% in B.
14.) Using the average and standard deviation from previous questions, calculate the Sharpe ratio for the portfolio formed by 30% in A and 70% in B.
15.) Which of the portfolios offer greater return per unit of risk taken?
A. The portfolio formed by 30% in A and 70% in B
B. portfolio formed by 40% in the SP500 and 60% in A
c. Both give the same return per unit of risk
PLEASE ANSWER ALL QUESTIONS!!!!!!!!
NOTE: For SHARP RATIO, assume the risk free rate to be 0
PLEASE ROUND TO 2 DECIMALS! THANK YOU
AVERAGES
| sp500 | A | B | |
| Average | -0.0069 | 0.0018 | 0.0015 |
covariance matrix:
| Sp500 | A | B | |
| Sp500 | 0.00336 | ||
| A | 0.00322 | 0.0041 | |
| B | 0.0044 | 0.00514 | 0.00824 |
For a portfolio formed by 40% in the SP500 and 60% in A. Calculate the return on the portfolio.
8.) Using the covariance matrix from question 7, calculate the variance of the portfolio formed by 40% in the SP500 and 60% in A.
9.) Using the variance from question 8, calculate the standard deviation of the portfolio formed by 40% in the SP500 and 60% in A.
10.) Using the average and standard deviation from previous questions, calculate the Sharpe ratio for the portfolio formed by 40% in the SP500 and 60% in A.
11.) Using the averages from question 7, calculate the average of a portfolio formed by 30% in A and 70% in B.
12.) Using the covariance matrix from question 7, calculate the variance of a portfolio formed by 30% in A and 70% in B.
13.) Using the variance from question 12, calculate the standard deviation for the portfolio formed by 30% in A and 70% in B.
14.) Using the average and standard deviation from previous questions, calculate the Sharpe ratio for the portfolio formed by 30% in A and 70% in B.
15.) Which of the portfolios offer greater return per unit of risk taken?
A. The portfolio formed by 30% in A and 70% in B
B. portfolio formed by 40% in the SP500 and 60% in A
c. Both give the same return per unit of risk
Related questions
PLEASE ROUND TO 2 DECIMALS! THANK YOU
1.) A company issues a 10 year bond, $1,000 face value, 4.5% coupon rate. If the bond sold for $1,045, what is the Yield to Maturity?
2.) For the bond of question 1, that is a $1,000 face value, 4.5% coupon rate, 10 year bond whose price is $1,045. What will be the price of the bond at the end of year 5?, assume the YTM does not change.
3.) The question is written here, but in order to be able to give you partial credit, I will ask for sub-sets of the final answer. Question 3 is composed of questions 3, 4, 5, and 6.
A company issues a 7 year bond, 6% coupon rate, $1,000 face value. This bond sold for $970. When the bond was sold the inflation rate was 1.5%, which changes to 2.5% after the end of year 3.
What is the YTM of this bond when it was issued?
4.) What was the real rate when the bond was issued? (Remember, the real rate is the nominal rate minus the inflation rate).
5.) Since the inflation rate is 2.5% after the end of year 3, what is the new nominal rate?
6.) Use the new nominal rate to calculate the price of the bond at the end of year 3.
7.) For questions 7 through 14, use the following averages and covariance matrix.
AVERAGES
| sp500 | A | B | |
| Average | -0.0069 | 0.0018 | 0.0015 |
covariance matrix:
| Sp500 | A | B | |
| Sp500 | 0.00336 | ||
| A | 0.00322 | 0.0041 | |
| B | 0.0044 | 0.00514 | 0.00824 |
For a portfolio formed by 40% in the SP500 and 60% in A. Calculate the return on the portfolio.
8.) Using the covariance matrix from question 7, calculate the variance of the portfolio formed by 40% in the SP500 and 60% in A.
9.) Using the variance from question 8, calculate the standard deviation of the portfolio formed by 40% in the SP500 and 60% in A.
10.) Using the average and standard deviation from previous questions, calculate the Sharpe ratio for the portfolio formed by 40% in the SP500 and 60% in A.
11.) Using the averages from question 7, calculate the average of a portfolio formed by 30% in A and 70% in B.
12.) Using the covariance matrix from question 7, calculate the variance of a portfolio formed by 30% in A and 70% in B.
13.) Using the variance from question 12, calculate the standard deviation for the portfolio formed by 30% in A and 70% in B.
14.) Using the average and standard deviation from previous questions, calculate the Sharpe ratio for the portfolio formed by 30% in A and 70% in B.
15.) Which of the portfolios offer greater return per unit of risk taken?
| a. | The portfolio formed by 30% in A and 70% in B | |
| b. | The portfolio formed by 40% in the SP500 and 60% in A | |
| c. | Both give the same return per unit of risk |
For the questions, use the following averages and covariance matrix. PLEASE HELP ASAP!
Averages
| Asset | 1 | 2 | 3 |
| Returns | 0.25 | 0.12 | 0.08 |
covariance matrix
| Asset 1 | Asset 2 | Asset 3 | ||
| Asset 1 | 0.4 | -0.1 | 0.2 | |
| Asset 2 | -0.1 | 0.7 | 0.3 | |
| Asset 3 | 0.2 | 0.3 | 0.9 |
1.) For a portfolio formed by 30% in asset 2 and 70% in asset 3. Calculate the return on the portfolio.
2.) Calculate the variance of the portfolio formed by 30% in asset 2 and 70% in asset 3.
3.) Using the variance from question 3b, calculate the standard deviation of the portfolio formed by 30% in asset 2 and 70% in asset 3.
4.) Using the average and standard deviation from previous questions, calculate the Sharpe ratio for the portfolio formed by 30% in asset 2 and 70% in asset 3.
5.) Calculate the average of a portfolio formed by 35% in asset 1 and 65% in asset 2.
6.) Calculate the variance of a portfolio formed by 35% in asset 1 and 65% in asset 2.
7.) Using the variance from question 3f, calculate the standard deviation for the portfolio formed by 35% in asset 1 and 65% in asset 2.
8.) Using the average and standard deviation from previous questions, calculate the Sharpe ratio for the portfolio formed by 35% in asset 1 and 65% in asset 2.
9.) Which of the portfolios offer greater return per unit of risk taken?
a. The portfolio formed by 30% in asset 2 and 70% in asset 3
b. The portfolio formed by 35% in asset 1 and 65% in asset 2
c. Both give the same return per unit of risk
For the questions, use the following averages and covariance matrix. PLEASE HELP ASAP! ROUND to 2 decimal places
EQUATION NEEDED FOR 8)=
Sharpe ratio for the portfolio = (Return on the portfolio-Risk Free Rate/standard deviation of the portfolio
Averages
| Asset | 1 | 2 | 3 |
| Returns | 0.25 | 0.12 | 0.08 |
covariance matrix
| Asset 1 | Asset 2 | Asset 3 | ||
| Asset 1 | 0.4 | -0.1 | 0.2 | |
| Asset 2 | -0.1 | 0.7 | 0.3 | |
| Asset 3 | 0.2 | 0.3 | 0.9 |
5.) Calculate the average of a portfolio formed by 35% in asset 1 and 65% in asset 2.
6.) Calculate the variance of a portfolio formed by 35% in asset 1 and 65% in asset 2.
7.) Using the variance from question 6, calculate the standard deviation for the portfolio formed by 35% in asset 1 and 65% in asset 2.
8.) Using the average and standard deviation from previous questions, calculate the Sharpe ratio for the portfolio formed by 35% in asset 1 and 65% in asset 2.
9.) Which of the portfolios offer greater return per unit of risk taken?
a. The portfolio formed by 30% in asset 2 and 70% in asset 3
b. The portfolio formed by 35% in asset 1 and 65% in asset 2
c. Both give the same return per unit of risk
