User Account

All Pages

Prices of the assets at close of trading

Assignment Help Finance Basics
Reference no: EM13961081

Suppose that the daily volatilities of asset A and asset B calculated at close of trading yesterday are 1.6% and 2.5%, respectively. The prices of the assets at close of trading yesterday were $20 and $40, and the estimate of the coefficient of correlation between the returns on the two assets made at close of trading yesterday was 0.25. The parameter used in the EWMA model is 0.95. (a) Calculate the current estimate of the covariance between the assets. (b) On the assumption that the prices of the assets at close of trading today are $20.5 and $40.5, update the correlation estimate.

Reference no: EM13961081

Questions Cloud

Determine the dynamic reactions at supports a and b : The helicopter can produce a maximum downward air speed v = 24m/s in a slipstream of diameter D = 9 m. Knowing that the weight of the helicopter and crew is 15 kN and assuming air density ρ= 1.21 kg/m3 , determine the maximum load that helicopter ..
Estimate of the daily volatility : The parameter in the EWMA model is 0.9. Suppose that the exchange rate at 4 p.m. today proves to be 1.4950. How would the estimate of the daily volatility be updated?
What legal or ethical issues would you consider : What legal or ethical issues would you consider as you select participants, if you were granted permission to answer one of these questions through a structured study at your school or agency
Provide the pw of this project and comment on desirability : You are considering buying a new SUV for your late-night beer delivery service. The SUV will cost $25,000, with a salvage value of $5,750 after five years. The vehicle will be used to travel 30,000 miles per year. You expect to have a yearly income o..
Prices of the assets at close of trading : (a) Calculate the current estimate of the covariance between the assets. (b) On the assumption that the prices of the assets at close of trading today are $20.5 and $40.5, update the correlation estimate.
Describe data cleaning and data dredging : Describe data cleaning and data dredging and what is the difference between primary and secondary data collection?
Write the surface area s as an integral : Write the surface area S as an integral. Let R be the region bounded by y = 1/x, the x - axis, x = 1, and x = b, where b > 1. Let D be the solid formed when R is revolved about the x-axis.
Determine least squares regression equation : City government has collected the following data on annual sales tax collections and new car registrations over the past 6 years: Determine the least squares regression equation.
What might be your best options : If you had a very limited budget but were committed to collecting and using some type of qualitative data to get at the perceptions of program participants, what might be your best options? Explain

Reviews

Write a Review

Finance Basics Questions & Answers

  What must flora show to recover damages from fast delivery

What must Flora show to recover damages from Fast Delivery?

  Examine the concept of time value of money in relation to

time value of moneynbsp please respond to the followingexamine the concept of time value of money in relation to

  A firm has a debt-equity ratio of 40 what is the total debt

a firm has a debt-equity ratio of .40. what is the total debt ratio?a. 29b. 33c. 67d. 1.40e. 1.50a firm has a

  Exchange rates between the united states

Using internet resources find the exchange rates between the United States and two (2) other foreign countries of your choice. Assume you own and operate a manufacturing company in one of the foreign countries selected and purchased material from ..

  What will be their sales as of year 10

Finally, their growth rate would slow down to 10 percent in years 8-10. What will be their sales as of year 10? (Round to the nearest dollar.)

  Checkmark which customer requirements

Fill the following table for cookies sold in a bakery. Indicate by a checkmark which customer requirements and which technical requirements are related. Use "√" to show the relation and "x" to indicate that there is no relation.

  Expected return and standard deviation

You have $10,000 for investment. What are the expected return and standard deviation for a portfolio with an investment of $6,000 in asset X and $4,000 in asset Z?

  Times interest earned is a valuable ratio to a vendor

times interest earned is a valuable ratio to a vendor because it tells the vendorawhether the company makes enough

  The pear torte sales are always listed in cell f7

Suppose you have listed Le Napoleon's monthly sales of pear tortes in a twelve-sheet workbook. The first worksheet contains January sales, the second worksheet February sales, etc. The pear torte sales are always listed in cell F7.

  Interest rate on type of loan

You want to buy a car. To do so, you will need to take out a loan in the amount of $19,000. The longest you are willing to pay on the loan is five years. The interest rate on this type of loan is 5.0% per year. How much will the equal monthly paym..

  Construct a pro forma income statement for the first year

Construct a pro forma income statement for the first year and second year for the following assumptions.

  A firm currently has the following capital structure which i

A firm currently has the following capital structure which it intends to maintain. Debt: $1,250,000 par value of 7.25% bonds outstanding with an annual before-tax yield to maturity of 6.50% on a new issue. The bonds currently sell for $115 per $100 p..

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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