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3 Need 100 percent perfect answer in 20 minutes.Please please solve quickly i will rate positive. please solve quickly. 3. Consider two assets A and
3 Need 100 percent perfect answer in 20 minutes.Please please solve quickly i will rate positive. please solve quickly.
3. Consider two assets A and B. Asset A has the following return with equal probability. A -1% 2% 3% 4% 8% The return of asset B follows a uniform distribution on [0.022, 0.042]. (a) Compute the expected return and semi-deviation of the return for both assets A and B in long position. [6 marks] (b) Compute the shortfall probability with benchmark 4%. [2 marks] (c) Which asset is better if an investor in long position only considers the information obtained in (a) and (b)? [2 marks] [Total marks 10] 3. Consider two assets A and B. Asset A has the following return with equal probability. A -1% 2% 3% 4% 8% The return of asset B follows a uniform distribution on [0.022, 0.042]. (a) Compute the expected return and semi-deviation of the return for both assets A and B in long position. [6 marks] (b) Compute the shortfall probability with benchmark 4%. [2 marks] (c) Which asset is better if an investor in long position only considers the information obtained in (a) and (b)? [2 marks] [Total marks 10]Step by Step Solution
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