Question
d. Determine the Sharpe ratios of companies from average returns and a risk-free rate of 4%. (9 marks) e. Make a scatterplot showing the returns
d. Determine the Sharpe ratios of companies from average returns and a risk-free rate of 4%. (9 marks)
e. Make a scatterplot showing the returns of Power Electric Industries and Rviera Power Inc. on the vertical axis and the returns of Nature Energy Corp. on the horizontal axis. (12 points)
f. Calculate the percentage of volatility (betas) of the companies Power Electric Industries and Riviera Power Inc. by making regressions from the returns. Compare the results with those reflected in the graph from the previous question. (Value: 12 points)
g. Determines the percent volatility (beta) and return for a portfolio comprised of 40% Power Electric Industries and 30% Riviera Power Inc. and Nature Energy Corp., respectively. (12 points)
Power, Electric Nature Riviera Power Inc. Industries Energy Corp. Year Stock price Dividends Stock price Dividends Stock price Dividends 2019 $18.5 $1.50 $38.5 $4.50 $58.5 $3.50 2018 $15.93 $1.10 $40.93 $3.10 $50.93 $2.10 2017 $10.20 $1.00 $43.20 $3.00 $53.20 $3.00 2016 $9.80 $0.90 $50.80 $2.90 $50.80 $2.90 2015 $8.50 $0 85 $48.50 $2.85 $48.50 $2.75 2014 $8.00 $0.80 $45.00 $2.80 $45.00 $2.60
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