Produce the lowest standard deviation

Assignment Help Financial Management
Reference no: EM131972379

1. Suppose you construct a portfolio of one stock and one bond that have a correlation of -0.5. The stock has a standard deviation of 16 percent and the bond has a standard deviation of 12 percent. What is the weight on the bond that will produce the lowest standard deviation?

2. In your will, you bequeath $6000000 into an account that earns 12% annually. The account will fund an annual award in perpetuity that will be given to a world leader who has excellent intentions to promote peace. If you want the award amount to increase by 6% every year, what will be the first year's award amount be?

Reference no: EM131972379

Questions Cloud

Determine the present worth capitalized cost : Determine the present worth capitalized cost of
Firm is trying to decide among three different projects : A firm is trying to decide among three different projects.
What is the irr for the investor : An investor on the “Shark Tank” has offered an entrepreneur a deal with his company. What is the IRR for the investor?
What is aftertax cost of debt : What is the aftertax cost of debt? What is the company’s WACC?
Produce the lowest standard deviation : What is the weight on the bond that will produce the lowest standard deviation?
What are capital markets : What are capital markets and why are they important to businesses around the world?
What are the effects on cash flow : What are the effects on cash flow, if variable costs increase to 60% of sales?
What value would mm now estimate for firm : What value would MM now estimate for each firm? What is rs for Firm L? What is the WACC for Firm U?
The rate or number of periods : When solving for the rate or number of periods in your financial calculator, w

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

  Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

  Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

  Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

  Business finance task - capital budgeting

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

  Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

  Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

  Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

  Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

  Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

  Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

  Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.

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