Question
As the Chief Risk Officer of Big Crypto Returns Inc., you need to determine the weighted probability of the year end returns for the trading
As the Chief Risk Officer of Big Crypto Returns Inc., you need to determine the weighted probability of the year end returns for the trading firms $27.5 million allocation to crypto investments.
Below is a probability table of potential returns for the firms crypto investments:
| Return | Probability |
| 267% | 2.00% |
| 183% | 3.50% |
| 94% | 6.00% |
| 46% | 17.00% |
| 21% | 33.25% |
| -25% | 23.00% |
| -43% | 9.25% |
| -71% | 6.00% |
- Calculate the weighted probability of returns (show the calculations). The answer should be both a percentage return and a dollar amount either gained or lost.
- Based on the above table, what is the maximum dollar amount the portfolio could return?
- Based on the above table, what is largest dollar loss the portfolio could experience?
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Startup CFO The Finance Handbook For Your Growing Business
Authors: Kyle Brennan
1st Edition
1790959403, 978-1790959402
