Stock fund in the minimum variance portfolio

Assignment Help Financial Management

Reference no: EM131308844

A stock fund has a standard deviation of 17 percent and a bond fund has a standard deviation of 8 percent. The correlation of the two funds is .24. What is the approximate weight of the stock fund in the minimum variance portfolio? Please show steps

Reference no: EM131308844

Questions Cloud

Identify the articles audience and purpose : Read the article and apply what you have learned about effective reading and writing to complete this assignment.Identify the author, title and publication information for your article. Identify the article's audience and purpose, and summarize the ..

Discuss the two-sided nature of default risk : Consider a European call option on a non-dividend-paying stock where the stock price is $52, the strike price $50, the risk-free rate is 5%, the volatility is 30%, and the time to maturity is one year. If in case (c) the option buyer has a 1% chance ..

Dividend is expected to grow forever at constant rate : Woidtke Manufacturing's stock currently sells for $22 a share. The stock just paid a dividend of $3.50 a share (i.e., D0 = $3.50), and the dividend is expected to grow forever at a constant rate of 6% a year. What stock price is expected 1 year from ..

What is the estimated value per share of boehms stock : Constant Growth Valuation Boehm Incorporated is expected to pay a $1.10 per share dividend at the end of this year (i.e., D1 = $1.10). The dividend is expected to grow at a constant rate of 3% a year. The required rate of return on the stock, rs, is ..

Stock fund in the minimum variance portfolio : A stock fund has a standard deviation of 17 percent and a bond fund has a standard deviation of 8 percent. The correlation of the two funds is .24. What is the approximate weight of the stock fund in the minimum variance portfolio?

The dividend for weaver : The dividend for Weaver, Inc., is expected to grow at 21 percent for the next 4 years before leveling off at a 5.8 percent rate indefinitely. If the firm just paid a dividend of $1.2 and you require a return of 14 percent on the stock, what is the mo..

Saving for retirement with the first payment : Your client is 32 years of age. She wants to begin saving for retirement with the first payment to come the beginning of the year. She can save $6000 per year. She can invest in the stock market and earn 12% interest. How much money will she have at ..

What is the price of the firms perpetual preferred stock : Carlysle Corporation has perpetual preferred stock outstanding that pays a constant annual dividend of $1.80 at the end of each year. If investors require an 6% return on the preferred stock, what is the price of the firm's perpetual preferred stock?

How much will their payment per month be : Ralph and Anne presently have $100,000 in their savings account if they wish to have $400,000 in 10 years while earning 10% interest, how much will their payment per month be?

User Account

All Pages