The annual standard deviation of returns on stock

Assignment Help Financial Management

Reference no: EM13929592

The annual standard deviation of returns on Stock A's equity is 31% and the correlation coefficient of these returns, with those on the market index is 0.82. Comparable numbers of stock B are 34% and 0.64. Assume the standard deviation for the market index is 25%, what are the betas for Stock A and B. Interpret those beats of Stock A and B

Reference no: EM13929592

Questions Cloud

Paying dividends-what is the current share price : Estes Park Corp. pays a constant $8.45 dividend on its stock. The company will maintain this dividend for the next 15 years and will then cease paying dividends forever. If the required return on this stock is 13 percent, what is the current share pr..

Decided to sell a new line of golf clubs : McGilla Golf has decided to sell a new line of golf clubs. The clubs will sell for $500 per set and have a variable cost of $200 per set. The company has spent $122,000 for a marketing study that determined the company will sell 56,000 sets per year ..

Analyze influence of innovation leaders organization culture : Assess the application of behaviors that leaders use to create innovative organizations. Analyze the influence of innovation leaders in an organization's culture and processes.

Consider project to supply detroit : Consider a project to supply Detroit with 40,000 tons of machine screws annually for automobile production. You will need an initial $1,440,000 investment in threading equipment to get the project started; the project will last for 7 years. The estim..

The annual standard deviation of returns on stock : The annual standard deviation of returns on Stock A's equity is 31% and the correlation coefficient of these returns, with those on the market index is 0.82. Comparable numbers of stock B are 34% and 0.64. Assume the standard deviation for the market..

Point-of-view of a common shareholder : (a) In your own words, from the point-of-view of a common shareholder, how would you estimate a company’s fundamental or intrinsic value? (b) What are some of the reasons why a company’s fundamental value might significantly exceed its “book value”?

What is the bonds yield-to-maturity : You just purchased a bond that matures in 16 years. The bond’s par value is $1,000, and you purchased the bond for $1,050. The bond’s issuer pays interest annually at the end of each year. The bond’s current yield is 6.25%. What is the bond’s yield-t..

What is the current market price of each bond : The James Company has issued bonds that have a 6.75% coupon rate and a par value of $1,000. The coupon amount is payable annually in arrears. The bonds mature 17 years from now. If the bonds’ yield-to-maturity is 7.15%, what is the current market pri..

What are the relevant facts and figures about this company : What are the relevant facts and figures about this company? For example, where is its headquarters? How many hotels/rooms are owned or identified with that company?

User Account

All Pages