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hello, i need the answers for all the questions 5, 6 and 9. thank you so much! 6. Two companies have stock for which the

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hello, i need the answers for all the questions 5, 6 and 9.
thank you so much!
6. Two companies have stock for which the expected returns and return standard deviations are forecast as: Company A B Expected Return 0.20 0.20 Standard Deviation 0.30 0.30 Consider a portfolio made up of 60% in asset A and 40% in asset B. a. What is the expected return on the portfolio? b. Assume that the correlation between the returns of assets A and B is 0. Since the two stocks' expected returns and standard deviations are the same, does it make any sense to combine them in a portfolio, or would you be just as well of holding either one of the stocks separately? Explain with math. It Styles and alpha for each stock. b. Identify and justify which stock would be more appropriate for an investor who wants to i) Add this stock to a well-diversified portfolio. ii) Hold this stock as a single-stock portfolio. 9. Suppose that a 1-year zero-coupon bond with the face value $100 currently sells at $94.34, while a 2-year zero sells at $84.99. You are considering the purchase of a 2-year-maturity bond making annual coupon payments. The face value of the bond is $100, and the coupon rate is 12% per year. a. What are the 1-year and 2-year spot rates? b. What is the price of the 2-year coupon bond? What is the forward rate for the second year? d. If the expectations hypothesis is accepted, what is the expected price of the coupon bond at the end of the first year? If the expectations hypothesis is accepted, what is the expected holding-period return of an investor who buys the coupon-bond and holds it for one year? C. e. I Focus 5. You are bullish on ABC stock. You purchased 200 shares of ABC common stock on margin at $50 per share. Assume the initial margin is 50% and the maintenance margin is 30%. a) How far does the price of ABC stock have to fall for you to get a margin call? Assume the price fall happens immediately. b) What will be your rate of return if the stock of ABC goes up to $55 during the next year? Assume no dividend during the year. Interest on margin call is 5% per annum. c) What would be your rate of return if you invested with your own money only

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