Question
The chief financial planner in our office wants to promote a new conservative income producing investment vehicle. His 1.96% forecast of bonds he considers to
The chief financial planner in our office wants to promote a new conservative income producing investment vehicle. His 1.96% forecast of bonds he considers to be quite stable. However, the 6.69% forecast for REITs may vary down by 2.84% and up by 0.54%. The corporate forecast for NYSE dividends is given to us as 3.44%, but he considers a more reasonable yields to be lower by 0.25% with a worst case scenario lower by a total of 0.72%. Finally our NASDAQ estimated yield is 1.41% with a possible increase of 0.17% and a decrease of 0.70%.
What is the worst-case scenario for the average yield of this portfolio assuming all four items are weighted equally?
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