Compute the expected return and risk of a portfolio, Managerial Accounting

Assignment Help:

Compute the Expected Return and Risk of a Portfolio?

The subsequent data are presented to you as a portfolio manager

Security

Expected Return         

Beta

Standard Deviation

A

.30

2.0

.50

B

.25

1.5

.40

C

.20

1.0

.30

D

.18

0.8

.25

E

.15

0.5

.20

a. Draw out a security market line. In terms of the security market line, define which of the securities listed above are undervalued and with reason.

b. Supposing that a portfolio is constructed by using equal proportions of the five stocks listed above, compute the expected return and risk of such type of a portfolio.


Related Discussions:- Compute the expected return and risk of a portfolio

State the factors of cvp, State the factors of CVP The three factors of...

State the factors of CVP The three factors of CVP analysis I e cost volume and profit are interconnected and dependent on one another . for example profit depends upon sales se

Manufacturing overheard, different methods used to assign manufacturing ove...

different methods used to assign manufacturing overhead

Budget preparation-monitoring and evaluation , Budget Preparation The ...

Budget Preparation The organization's budget is ready following the acceptance and sanction of the decision packages. Once the budget of organization has been accepted manager

Interest rate and dividend, Compute the ‘fair' value of the two nearest to ...

Compute the ‘fair' value of the two nearest to expiration futures contracts on the Hang - Seng Index (HSI) using HSI as the underlying asset Answer the following questions: a

The f–test , The F–test    The significance of the regression results...

The F–test    The significance of the regression results can be tested by using the F- statistics. The F-statistics is a ratio which compares the explained sum of squares and t

Advantages of participatory budgets, Advantages of participatory budgets ...

Advantages of participatory budgets Information from employees most recognizable with each unit’s needs and constraints is included. Knowledge spread amongst numerous lev

Product mix decision when capacity constraints exist, a certain company mak...

a certain company makes 3 products A,B and C and they use the same raw material zhong.details about each product is as follows.production units are 10 000 for A,8 000 for B,12 000

What is master budget, What is Master budget Financial budget are conce...

What is Master budget Financial budget are concerned with cash receipts and disbursements working capital. Several functional budgets are integrated into master budget. This bu

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd