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Please answer A-E Rate of return, standard deviation, coefficient of variation Personal Finance Problem Mike is searching for a stock to include in his current
Please answer A-E
Rate of return, standard deviation, coefficient of variation Personal Finance Problem Mike is searching for a stock to include in his current stock portfolio. He is interested in Hi-Tech Inc.; he has been impressed with the company's computer products and believes Hi-Tech is an innovative market player. However, Mike realizes that any time you consider a technology stock, risk is a major concern. The rule he follows is to include only securities with a coefficient of variation of returns below 1.11. Mike has obtained the following price information for the period 2015 through 2018: B. Hi-Tech stock, being growth-oriented, did not pay any dividends during these 4 years. a. Calculate the rate of return for each year, 2015 through 2018, for Hi-Tech stock. b. Assume that each year's return is equally probable and calculate the average return over this time period. c. Calculate the standard deviation of returns over the past 4 years. (Hint: Treat this data as a sample.) d. Based on b and c determine the coefficient of variation of returns for the security. e. Given the calculation in d what should be Mike's decision regarding the inclusion of Hi-Tech stock in his portfolio? ... a. The rate of return for year 2015 is %. (Round to two decimal places.) - X Data Table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Year 2015 2016 2017 2018 Stock price Beginning $14.75 $21.41 $64.52 $72.49 End $21.41 $64.52 $72.49 $91.53 Print Done Enter your answer in the answer box and then click CheckStep by Step Solution
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