This is all one problem, but it has multiple parts
Problem #2: Yahoo Finance and CAPM Use yahoo finance to find information for the common stock of Chevron Corporation. Its ticker symbol is "CVX". Chevron Corporation, through its subsidiaries, engages in integrated energy and chemicals operations worldwide. The company operates in two segments, Upstream and Downstream. The Upstream segment is involved in the exploration, development, production, and transportation of crude oil and natural gas; processing, liquefaction, transportation, and regasification associated with liquefied natural gas; transportation of crude oil through pipelines, and transportation, storage, and marketing of natural gas, as well as operates a gas-to-liquids plant. The Downstream segment engages in refining crude oil into petroleum products, marketing crude oil, refined products, and lubricants; manufacturing and marketing of renewable fuels; transporting crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car; and manufacturing and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives. It is also involved in the cash management and debt financing activities, insurance operations, real estate activities, and technology businesses. The company was formerly known as Chevron Texaco Corporation and changed its name to Chevron Corporation in 2005. Chevron Corporation was founded in 1879 and is based in San Ramon, California. Q1. On which exchange is the stock traded? Q2. How big is the company? If you bought all of the shares at the last price, how much would it cost? That is also called "market capitalization". No abbreviations, please. Q3. What is CVX's retention ratio? Q4. What is CVX's most recent Price/Book Ratio [MRQ]? Q5: What was CVX's most recent Price/Earnings Ratio [MRQ]? Q6. What was the price of CVX's stock five years ago? Q7. If you bought CVX five years ago at this price, and sold it today, how much did you earn per year, compounded annually? (This is similar to the average annual return calculation that we did for the Fidelity mutual funds). SHOW WORK ... NO WORK ... NO POINTS. Q8. What is CVX's beta? Q9. Does CVX have more systematic risk than the S&P500? Q10. Does CVX have more total risk than the S&P500? Q11. What's the beta for the S&P500? Q12 & Q13. Give the CAPM equation that is used to find the "required return for a stock. Define all terms. Q14. Use this equation to estimate the "required return" for CVX stock over the last 5 years. Use the beta for CVX from Q8. Estimate the return on 3-month T-bills [Rf rate) to be 1% per year over the last 5 years. The return on the S&P500 [Rm] was 11.90% per year over the last 5 years. Q15. Has CVX had a positive historic alpha for the last 5 years? Stated differently, on a risk-adjusted basis, did CVX outperform the market over the last 5 years? Hint: Has CVX's actual return [Q7] been higher than the required return [Q14]? Problem #2: Yahoo Finance and CAPM Use yahoo finance to find information for the common stock of Chevron Corporation. Its ticker symbol is "CVX". Chevron Corporation, through its subsidiaries, engages in integrated energy and chemicals operations worldwide. The company operates in two segments, Upstream and Downstream. The Upstream segment is involved in the exploration, development, production, and transportation of crude oil and natural gas; processing, liquefaction, transportation, and regasification associated with liquefied natural gas; transportation of crude oil through pipelines, and transportation, storage, and marketing of natural gas, as well as operates a gas-to-liquids plant. The Downstream segment engages in refining crude oil into petroleum products, marketing crude oil, refined products, and lubricants; manufacturing and marketing of renewable fuels; transporting crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car; and manufacturing and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives. It is also involved in the cash management and debt financing activities, insurance operations, real estate activities, and technology businesses. The company was formerly known as Chevron Texaco Corporation and changed its name to Chevron Corporation in 2005. Chevron Corporation was founded in 1879 and is based in San Ramon, California. Q1. On which exchange is the stock traded? Q2. How big is the company? If you bought all of the shares at the last price, how much would it cost? That is also called "market capitalization". No abbreviations, please. Q3. What is CVX's retention ratio? Q4. What is CVX's most recent Price/Book Ratio [MRQ]? Q5: What was CVX's most recent Price/Earnings Ratio [MRQ]? Q6. What was the price of CVX's stock five years ago? Q7. If you bought CVX five years ago at this price, and sold it today, how much did you earn per year, compounded annually? (This is similar to the average annual return calculation that we did for the Fidelity mutual funds). SHOW WORK ... NO WORK ... NO POINTS. Q8. What is CVX's beta? Q9. Does CVX have more systematic risk than the S&P500? Q10. Does CVX have more total risk than the S&P500? Q11. What's the beta for the S&P500? Q12 & Q13. Give the CAPM equation that is used to find the "required return for a stock. Define all terms. Q14. Use this equation to estimate the "required return" for CVX stock over the last 5 years. Use the beta for CVX from Q8. Estimate the return on 3-month T-bills [Rf rate) to be 1% per year over the last 5 years. The return on the S&P500 [Rm] was 11.90% per year over the last 5 years. Q15. Has CVX had a positive historic alpha for the last 5 years? Stated differently, on a risk-adjusted basis, did CVX outperform the market over the last 5 years? Hint: Has CVX's actual return [Q7] been higher than the required return [Q14]
