Solution-Calculate the expected return and standard

Calculate the expected return and standard deviation

Assignment Help Accounting Basics

Reference no: EM133166985

Question - a. The following historical time series of data on a security returns is available from 2016 to 2020:

Year	Return on a Security, %
2016	35
2017	20
2018	15
2019	18
2020	-8

Required - Calculate the expected return and standard deviation of the returns from the above discreate distribution.

b. An analyst predicts the following possibilities on a security returns next year:

State	Probability	Return on a Security, %
Boom	0.20	30
Good	0.60	12.5
Crash	0.20	-12.5

Required - Calculate the expected return and standard deviation of the returns from the above probability distribution the security of:

1. Expected Return:

2. Variance:

3. Standard Deviation:

Reference no: EM133166985

Questions Cloud

Child diagnosed with a developmental disability : Describe the differences in services that you can provide for parents with a child diagnosed with a developmental disability. What kinds of recommendations

Explain why we depreciate assets : Explain why we depreciate assets over their useful lives instead of just expensing them in the year they are acquired

Main forces in the macro environment for organization : Discuss some of the main actors in the microenvironment and the main forces in the macroenvironment for your organization.

Discuss the obstacles that families may face : Discuss the obstacles that families may face in the attempt to be involved. Read the following sources to guide your background knowledge

Calculate the expected return and standard deviation : The following historical time series of data on a security returns is available from 2016 to 2020: Calculate the expected return and standard deviation

What was the value of securities by bp : If the notes were issued at a yield set 2% higher than 10-year bond rate (which was running at about 7%), What was the value of securities

How much of imputation tax credit is attached : If a company pays $7,850,000 franked dividend distribution, how much of imputation tax credit is attached with this distribution

Internal and external environmental challenges : Analyze the internal & external environmental challenges to assess the effectiveness of the strategic plan implementation.

Calculate the revenue from this contract for the accounting : Calculate the revenue from this contract for the accounting years ended 2019 and 2020 in accordance with the provisions of MFRS 15

User Account

All Pages

Calculate the expected return and standard deviation

Reference no: EM133166985

Reference no: EM133166985

Questions Cloud

Reviews

Write a Review

Accounting Basics Questions & Answers

How much control does fed have over this longer real rate

Coures:- fundamental accounting principles

Accounting problems

Theory of interest - term structure of interest rates

Write a report on internal controls

Prepare the bank reconciliation for company

Cost-benefit analysis

Theory of interest

Liquidity and profitability

What is the expected risk premium on the portfolio

Simple interest and compound interest

Capm and venture capital

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT