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Use the following information to answer a). WOW Ltd Price Dividend 1 Jan 2020 $41.84 4 March 2020 $0.46 1 July 2020 $38.68 a) Assume
Use the following information to answer a). WOW Ltd Price Dividend 1 Jan 2020 $41.84 4 March 2020 $0.46 1 July 2020 $38.68 a) Assume that you purchased WOW Ltd shares on 1 Jan 2020 and sold them on 1 July 2020. A dividend of $0.46 was paid on 4 Mar 2020. Calculate the realised return for the period. (2 marks) Use the following information to answer b). BHP Ltd S&P/ASX200 Monthly average return 1.3% 0.17% Standard Deviation 17.87% 14.38% Covariance between BHP and S&P/ASX200 0.0020 b) ) Compute the following. i) Calculate the correlation coefficient between BHP and S&P/ASX200 and interpret the answer. (2 marks) ii) Calculate the beta of BHP and interpret the answer. (2 marks) iii) Assuming the market risk premium of 6% and the risk-free rate of 1%, compute the required rate of return of BHP Ltd. (2 marks)
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