Calculate the average return, Financial Econometrics

Assignment Help:

The  expected  return  and  risk  involved  in  making  an  investment  are important  factors  considered  by  investors.  The  expected  return  of  a business can be influenced by many factors. Past performance is considered to reflect expected future performance and an equal probability of 25% is assumed for all returns. Based on the analysis of past returns and forecasting, the following information is available for returns on two shares

listed on the stock exchange:

Year

Mazebe

Baduna

2009

0.20

0.16

2010

0.28

0.12

2011

0.36

0.10

2012

0.12

0.18

Required:

1 Calculate the average return for each of the two shares.

2 Calculate the risk involved by use of the standard deviation of each of the two shares.

3 Calculate the co-efficient of variation of each of the two shares.


Related Discussions:- Calculate the average return

Finance, apple is having too much cash, discuss six reasons of why sharehol...

apple is having too much cash, discuss six reasons of why shareholders are so worried

Intercorporate investments, Intercorporate investments: DI has a 25% ...

Intercorporate investments: DI has a 25% interest in a gold mine in the Yukon. They have held this investment for eighteen months. During this time it has not made any mon

The desire amount, To buy a retirement home, you will need $525,000 in 18 y...

To buy a retirement home, you will need $525,000 in 18 years. If funds can be invested at an effective return of 6 percent a year, how much must you invest today to have the desire

Options, Four European vanilla Call options ()iC· on an underlier with no i...

Four European vanilla Call options ()iC· on an underlier with no interim cash flows, have identical maturity T. Their strike prices iK are such that 1234KKKK A trader buys ()1CK an

Types of working capital policy, Within a business, funds are required...

Within a business, funds are required to finance both non-current and current assets. The level of current assets fluctuates, though there tends to be an underlying lev

Effective yield to maturity, Research in Motion (RIM), once known as the gl...

Research in Motion (RIM), once known as the global leader in wireless innovation, has lost its darling status after the introduction of the Apple iPhone.  In 2011, RIM's stock pric

The variance of the returns on rt inc. stock, Question If the economy b...

Question If the economy booms, RTF, Inc. stock is expected to return 10%. If the economy goes into a recessionary period, then RTF is expected to only return 4%. The probabilit

Differences in working capital for different industries, Differences in wor...

Differences in working capital for different industries   Manufacturing Retail Service Inventories Hig

Options, Prices of Calls and Puts Options the shares of Marks & Spencer ...

Prices of Calls and Puts Options the shares of Marks & Spencer a) Explain carefully why the November calls are trading at higher prices than the September calls. b) Draw a diag

Write Your Message!

Captcha
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