Part II Problem Solving (40 Points)

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Year	Tippy Stock	Sibbit Stock	S&P 500
2007	-10.8%	3.85%	-2.87%
2008	-3.5%	-7.25%	3.39%
2009	4.9%	4.33%	1.45%
2010	2.9%	8.21%	4.56%
2011	-3.8%	-2.55%	-2.38%

The Z-statistic at the 5% confidence level is 1.6449

The Z-statistic at the 10% confidence level is 1.2816

The Z-statistic at the 1% confidence level is 2.3263

What are the mean, standard deviation, and beta for Tippy stock?

What are the mean, standard deviation, and beta for Sibbit Stock?

What are the mean and standard deviation for S&P 500?

What is the maximum expected loss for Tippy stock at the 1% confidence level using standard deviation?

What is the maximum expected loss for S&P at the 5% confidence level using standard deviation?

What is the maximum expected loss for stock Tippy stock at the 5% confidence level using beta?

What is the maximum dollar loss if you invest $4,000,000 in Tippy stock using beta?

What are the Sharpe and Treynor index for Sibbit stock? Assume that T-bill rate is 0.05%