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Stocks A and B Have The Following Historical Returns A Calculate PDF

This document provides historical return data for Stocks A and B from 2007 to 2011 and asks the reader to calculate various metrics to analyze the risk and return of each stock individually as well as a portfolio consisting of 50% of each stock. It asks the reader to calculate average annual returns, standard deviation, coefficient of variation, and determine which option a risk-averse investor would prefer based on the analysis.

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Anbu jaromia
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135 views1 page

Stocks A and B Have The Following Historical Returns A Calculate PDF

This document provides historical return data for Stocks A and B from 2007 to 2011 and asks the reader to calculate various metrics to analyze the risk and return of each stock individually as well as a portfolio consisting of 50% of each stock. It asks the reader to calculate average annual returns, standard deviation, coefficient of variation, and determine which option a risk-averse investor would prefer based on the analysis.

Uploaded by

Anbu jaromia
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Stocks A and B have the following historical returns a

Calculate

Stocks A and B have the following historical returns:

a. Calculate the average rate of return for each stock during the period 2007 through 2011.

b. Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B.
What would the realized rate of return on the portfolio have been each year? What would the
average return on the portfolio have been during this period?

c. Calculate the standard deviation of returns for each stock and for the portfolio.

d. Calculate the coefficient of variation for each stock and for the portfolio.

e. Assuming you are a risk-averse investor, would you prefer to hold Stock A, Stock B, or the
portfolio? Why?

Stocks A and B have the following historical returns a Calculate


SOLUTION-- http://accountinginn.online/downloads/stocks-a-and-b-have-the-following-historical-
returns-a-calculate/

For Solutions Visit accountinginn.online


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