A broker has advised you not to invest in technology stocks because they have high standard deviations.
Question:
A broker has advised you not to invest in technology stocks because they have high standard deviations. Is the broker’s advice sound for a risk-averse investor like yourself?
Why or why not?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 100% (1 review)
The brokers advice is based on the observation that technology stocks have high standard deviations ...View the full answer
Answered By
Emel Khan
I have the ability to effectively communicate and demonstrate concepts to students. Through my practical application of the subject required, I am able to provide real-world examples and clarify complex ideas. This helps students to better understand and retain the information, leading to improved performance and confidence in their abilities. Additionally, my hands-on approach allows for interactive lessons and personalized instruction, catering to the individual needs and learning styles of each student.
5.00+
2+ Reviews
10+ Question Solved
Related Book For
Corporate Finance
ISBN: 9780077173630
3rd Edition
Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe
Question Posted:
Students also viewed these Business questions
-
A broker has advised you not to invest in oil industry stocks because they have high standard deviations. Is the brokers advice sound for a risk-averse investor like yourself? Why or why not?
-
Mrs. B, recently widowed and in her mid to late 40s, is a senior executive working for a Singapore-based multi-national corporation with SGD 10 billion in global sales. She has a son aged 20 and a...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
On January 1, 20X7, CP Co. (a Canadian company) purchased 80% of SF Co. (a U.S. company) at a cost of US$50,000. The book values of SF's net assets were equal to their fair market values on this date...
-
Evaluate the composition of the Steering Committee. Do you feel it has adequate representation? Explain. What do you think its role should be in the project? Is its charge clear?
-
Write a template function maxn() that takes as its arguments an array of items of type T and an integer representing the number of elements in the array and that returns the largest item in the...
-
Suppose that we are trying to value a three-period call option on a stock that will either go up by 7 percent or down by 4 percent per period, that the exercise price of the option is $35, that the...
-
Westinghouse Electric Corporation The following note appears in the Summary of Significant Accounting Policies section of the Annual Report of Westinghouse Electric Corporation. Note 1 (in part):...
-
Retained earnings versus new common stock Using the data for a firm shown in the following table, calculate the cost of retained earnings and the cost of new common stock using the constant-growth...
-
An equity has a beta of 0.9 and an expected return of 9 per cent. A risk-free asset currently earns 2 per cent. (a) What is the expected return on a portfolio that is equally invested in the two...
-
Explain what is meant by short selling. When is short selling profitable?
-
Headquartered in Ann Arbor, Michigan, Dominos is the second-largest pizza chain in the United States behind Pizza Hut. Dominos has over 10,000 delivery-only stores in about 70 countries and in all 50...
-
Expected dividends on a stock are 5 and current market price is 100. Given a constant and perpetual growth of 2%, what is the expected return rate?
-
The BB Company plans to sell 300,000 units annually of a certain new product at a projected sales price of $10 per unit. The new product's variable cost is $6 per unit, and annual fixed costs are...
-
1. Describe how legal principles can conflict with religious beliefs in the hospital setting. 2. Describe the role of a Healthcare Ethics Committee, and give an example of a case they may be involved...
-
How does advanced computational fluid dynamics (CFD) analysis contribute to the design optimization of complex hydraulic structures such as spillways, weirs, and stormwater management systems,...
-
La Ronge Nature Adventures (LNA) maintains a strict debt to equity ratio of 0.60. The current market price per common share is $60. LNA expects this year's earnings to be $210 million. a.What will...
-
Explain the relationships among the initial assessed control risk, tests of controls and substantive tests of transactions for cash disbursements, and the tests of details of cash balances. Give one...
-
For the following exercises, rewrite the sum as a product of two functions or the product as a sum of two functions. Give your answer in terms of sines and cosines. Then evaluate the final answer...
-
Crecimiento S.A. currently plows back 40 percent of its earnings and earns a return of 20 percent on this investment. The dividend yield on the stock is 4 percent. a. Assuming that Crecimiento can...
-
Vega Motor Corporation has pulled off a miraculous recovery. Four years ago, it was near bankruptcy. Now its charismatic leader, a corporate folk hero, may run for president. Vega has just announced...
-
P/E ratios reported in The Wall Street Journal use the latest closing prices and the last 12 months reported earnings per share. Explain why the corresponding earningsprice ratios (the reciprocals of...
-
Grove Corp. has revenues of $1,590,000 resulting in an operating income of $177,000. Average invested assets total $757,000. If sales increase by 10% and the investment level remains constant, what...
-
Finlon Upholstery, Inc., uses a job-order costing system to accumulate manufacturing costs. The companys work-in-process on December 31, 20x1, consisted of one job (no. 2077), which was carried on...
-
En su primer mes de operacin, Hoffman Company compr 100 unidades de inventario por $6, luego 200 unidades por $7 y finalmente 140 unidades por $8. Al cierre del mes quedaban 180 unidades. La empresa...
Study smarter with the SolutionInn App