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!
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
Related questions
PLEASE LEAVE IN DECIMAL FORM & SHOW WORK 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 |
1. For a portfolio formed by 40% in the SP500 and 60% in A. Calculate the return on the portfolio.
2. Using the covariance matrix from question 7, calculate the variance of the portfolio formed by 40% in the SP500 and 60% in A.
3. Using the variance from question 8, calculate the standard deviation of the portfolio formed by 40% in the SP500 and 60% in A.
4. Using the averages from question 7, calculate the average of a portfolio formed by 30% in A and 70% in B.
5. Using the covariance matrix from question 7, calculate the variance of a portfolio formed by 30% in A and 70% in B.
6. Using the variance from question 12, calculate the standard deviation for the portfolio formed by 30% in A and 70% in B.
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 ROUND TO 2 DECIMALS & SHOW WORK 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 |
1.) Using the covariance matrix from question 7, calculate the variance of the portfolio formed by 40% in the SP500 and 60% in A.
2.) Using the covariance matrix from question 7, calculate the variance of a portfolio formed by 30% in A and 70% in B.
