What can you do to alleviate your timing risk

Assignment Help Financial Management
Reference no: EM131247250

Suppose you believe your portfolio, which has a beta of 1.0, has been selected to outperform other portfolios of similar risk but you know you cannot predict which way the market will move.

If it goes down, you will outperform the market but will still have a negative rate of return. What can you do to alleviate your timing risk?

Reference no: EM131247250

Questions Cloud

Determine the magnitude of the thrust on the plane : Suppose a jet engine takes in air at a mass flow rate of 100 kg/s. Also assume that the exhaust velocity of the air is 500 m/s relative to the plane.
Evaluate the internal validity of the study : Evaluate the internal validity of the study. Evaluate the external validity of this study to a typical person catching a cold. Evaluate in terms of structural, functional, and conceptual components?
Cross-cultural etiquette and communication in global busines : Cross-Cultural Etiquette and Communication in Global Business: Towards a Strategic Framework for Managing. By; Ephraim Okoro - Excuse Us, Your Manners Are Missing! The role of Business Etiquette in Today's Era of Cross-Cultural Communication bySoum..
Tree depends linearly on the number of trees : Assuming that the yield per tree depends linearly on the number of trees in the orchard, what should you do this year to maximize your total yield?
What can you do to alleviate your timing risk : If it goes down, you will outperform the market but will still have a negative rate of return. What can you do to alleviate your timing risk?
Find an expression for the thrust produced by engine : Assuming that the jet accelerates the air to a speed vrel relative to the jet's center of mass G, draw a control volume and find an expression for the thrust produced by the engine.
How many t bond contracts needed to minimize shareholder : If the current market value is $80,000 for a T-bond futures contract with a $100,000 face value, how many T-bond contracts will be needed to minimize shareholders; risk exposure to interest rate fluctuations?
Problem regarding the monetary investment : Suppose that when the amount of labor provided per week is x (hours) and the monetary investment is y (dollars) the quantity produced is100x1/2y1/2. Suppose that currently x= 900 and y=400. At what rate can monetary investment be reduced if addition..
Do you think that there is sufficient social mobility in us : Is there equal opportunity for everyone in the U.S. to become part of that top 1%? Why or why not? Explain your response. Do you think that there is sufficient social mobility in the U.S? Why or why not?

Reviews

Write a Review

Financial Management Questions & Answers

  Establish the petty cash fund

On June 1 of the current year, Philips Company established a $150 petty cash fund. On June 30, the petty cashbox had $53. The petty cash receipts on that date were as follows: Office Supplies $54.00 Misc. Expense $35.00 Freight Paid on Merchandise Pu..

  Estimates the projects terminal value

A project is expected to generate the following sequence of cash flows over the first five years of its life: Year 0 1 2 3 4 5 CF ($m) -65.00 8.00 8.00 9.00 9.50 10.00 Assume the appropriate discount rate for the project is 10%. Estimates the project..

  Think about what should be entered for amort

How much interest will you pay in the 11th year of a $100,000, 7.5%, 25 year mortgage, assuming monthly compounding? (Hint: 121-input, you need to think about what should be entered for amort)

  Assume the total cost of a college education

Assume the total cost of a college education will be $200,000 when your child enters college in 16 years. You presently have $73,000 to invest. What annual rate of interest must you earn on your investment to cover the cost of your child's college ed..

  Bout interest rate risk of lower-coupon bonds

Bond J is a 3% coupon bond. Bond K is 9% coupon bond. Both have 15 years to maturity, make semi-annual payments, and have a YTM of 6%. If the interest rate suddenly rises by 2%, what is the percentage price change of these bonds? What is rate suddenl..

  Order return probability

Calculate the expected return on an asset that has the following probable returns:

  Sells extended warranties for durable consumer goods

Peace of Mind, Inc. (PMI), sells extended warranties for durable consumer goods such as washing machines and refrigerators. When PMI sells an extended warranty, it receives cash up front from the customer, but later PMI must cover any repair costs th..

  A zero bond with a long maturity date

A zero bond with a long maturity date has:

  How much will you be able to withdraw at end of five years

You deposit $2,300 into an account that pays 4% per year. Your plan is to withdraw this amount at the end of 5 years to use for a down payment on a new car. How much will you be able to withdraw at the end of 5 years? Round your answer to the nearest..

  What is the net advantage to leasing arrangement

To finance some manufacturing tools it needs for the next 3 years, Waldrop Corporation is considering a leasing arrangement. The tools will be obsolete and worthless after 3 years. The firm will depreciate the cost of the tools on a straight- line ba..

  Signed a professional contract to play cricket

Suppose you have just signed a professional contract to play cricket in Argentina. The contract is for 4 years and is as follows. You get an immediate signing bonus of $280,000, followed by four years of quarterly payments of $75,000. You plan to inv..

  What is the bank''s cost of preferred stock

Holdup Bank has an issue of preferred stock with a $8 stated dividend that just sold for $95 per share. What is the bank's cost of preferred stock? The price of any asset is the present value of future cash flows. The preferred stock has a constant d..

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