Using Table 5.3 as your guide, what is your estimate of the expected annual HPR on the S&P 500 stock portfolio if the current risk-free interest rate is 5.4%? Round your answer to 2 decimal places.) Expected annual HPR TABLE 5.3 Statistics for asset-class index portfolios, 1926-2013 (annual rates in U.S. dollars, %) World Markets U.S. Markets Government Bonds Small Stocks U.S. Long-Term Treasuries Stocks Stocks A. Total Returns 5.07 39.94 (1931) -13.50 (1946) -54.27 (1937) -45.56 (1931)-13.82 (2009) 70.81 (1933) 34.12 (1985) 159.05 (1933 54.56 (1933) 32.68 (1985) 9.88 Geometric average (%) Lowest return Highest return 5.37 B. Risk (Measured Using Excess Returns) 37.29 48.33 20.52 31.96 Standard deviation 18.89 8.44 8.01 Value at risk (VaR) 5% 25.88 10.67 C. Deviation from Normality -22.54 3.34 0.09 -10.43 0.24 0.68 1.39 -36.96 VaR assuming normality Actual VaR minus normal Skew Kurtosis 23.51 10.23 0.83 1.97 0.31 0.05 0.39 0.53 D. Returns in Excess of one-Month T-Bill Rates 6.32 2.01 Average excess return Standard error 13.94 3.97 8.34 0.90 0.85 E. Sharpe Ratios for 1926-2013 and Three Subperiods 0.26 0.22 0.05 0.52 0.37 0.40 0.38 0.33 Entire period 1926-1955 1956-1985 1986-2013 0.23 0.59 0.28 0.35 F. Correlations of Excess Returns 0.02 0.22 With inflation 0.27 0.06 With T-bill rates 0.25 Colored entries indicate s of tail risk that exceed values consistent with a nomal distribution. World portfolio of Equities: 1926-1969 Simson, Marsh and Staunton (Equity Premia Around the World) 1970-2013 Bloomberg-MSCI World in USS. Staunton (ibid);, 1988-2013 Bloomberg: Barclay's Global Treasuries in US.S.: World bonds: 1926-1987 Dimson, M Small Stocks: Kenneth French Data Library, Lowest Quantile stocks Center for Research in Price (CRSP), S&P 500 Long-Term Treasury bonds: Bloomberg: Barclay's U.S. Long-Term Treasury index bills: Kenneth French Data Library Inflation data: Economagic- rollover of 30-day T-bills, r Statistics cpiu dec2dec. Bureau of L