FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

W6 Q4 Suppose that the average stock has a volatility of 49%, and that the correlation between pairs of stocks is 19%. Estimate the volatility

W6 Q4 image text in transcribed

Suppose that the average stock has a volatility of 49%, and that the correlation between pairs of stocks is 19%. Estimate the volatility of an equally weighted portfolio with: a. 1 stock b. 30 stocks c. 1,000 stocks a. The volatility of an equally weighted portfolio with 1 stock is b. The volatility of an equally weighted portfolio with 30 stocks is \%. (Round to two decimal places.) \%. (Round to two decimal places.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Multifractal Detrended Analysis Method And Its Application In Financial Markets

Multifractal Detrended Analysis Method And Its Application In Financial Markets

Authors: Guangxi Cao, Ling-Yun He, Jie Cao

1st Edition

9811079153, 978-9811079153

More Books

Students also viewed these Finance questions

Question

★★★★★
Suppose half of all the transactions in a clothes shop purchase jeans, and one third of all transactions in the shop purchase T-shirts. Suppose also that half of the transactions that purchase jeans...

Answered: 1 week ago

Question

★★★★★
Analyzing a firm's financial condition using its financial statements can be likened to performing a physical examination. A physician assesses a patient's health by checking temperature, blood...

Answered: 1 week ago

Question

★★★★★
10.53 Instrument Precision A precision instrument is guaranteed to read accurately to within 2 units. A sample of four instrument readings on the same object yielded the measurements 353, 351, 351,...

Answered: 1 week ago

Question

★★★★★
Princess has acquired several other companies. Assume that Princess purchased Kettle for $11,000,000 cash. The book value of Kettles assets is $12,000,000 (market value, $16,000,000), and it has...

Answered: 1 week ago

Question

★★★★★
What is the future value of a 7%, 6-year ordinary annuity that pays $300 each year? If this were an annuity due, what would its future value be?

Answered: 1 week ago

Question

★★★★★
usco Po 2. WACC. Here is some information about Stokenchurch Inc.: Beta of common stock = 1.2 Treasury bill rate = 4% Market risk premium = 7.5% Yield to maturity on long-term debt = 6% Book value of...

Answered: 1 week ago

Question

★★★★★
Post an explanation of how identity, privilege, power, and oppression influence professional practice based on Janet Helms's explanation in the Microtraining Associates video. Then explain the...

Answered: 1 week ago

Question

★★★★★
VWX Inc., has sales of $500,000, net income of $80,000, dividend payout of 50%, total assets of $700,000 and target debt-equity ratio of 1.5. If the company grows at its sustainable growth rate in...

Answered: 1 week ago

Question

★★★★★
Because a mother does not want to "spoil" her new born baby. She feeds and takes care of her baby's physical needs when she thinks the baby needs care, not when the baby cries to indicate their...

Answered: 1 week ago

Question

★★★★★
Application of Core Conflictual Relationship Theme (CCRT) Therapy to counselling immigrants and refugees Evidence understanding of applying a contemporary psychodynamic theory which can be modified...

Answered: 1 week ago

Question

★★★★★
Which of the following features of "There Will Come Soft Rains" does not reflect postmodernism? A . Its pastiche characteristics and blending of genres: elements of satire, speculative fiction,...

Answered: 1 week ago

Question

★★★★★
5. In small groups in your class, discuss how popular culture and films portray interpersonal relationships, considering specifically relationship stages. Discuss communication techniques that the...

Answered: 1 week ago

Question

★★★★★
4. As a new romantic relationship begins, keep a journal of the communication events that occur. In this journal, indicate the stage you perceive the relationship to be in (based on the stages in...

Answered: 1 week ago

Question

★★★★★
3. Consider a romantic relationship that has ended. Using the stages outlined in this chapter, create a time line of the relationship. Include significant turning points that encouraged the...

Answered: 1 week ago

Previous Question Next Question