Question

8-20 REALIZED RATES OF RETURN Stocks A and B have the following historical returns: Year Stock...

8-20 REALIZED RATES OF RETURN Stocks A and B have the following historical returns:

Year Stock A's Returns, rA. Stock B's Returns, rB

2011 (18.00%) (14.50%)

2012 33.00 21.80

2013 15.00 30.50

2014 (0.50) (7.60)

2015 27.00 26.30

a. Calculate the average rate of return for each stock during the period 2011 though 2015.

b. Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B. What would the realized rate of return on the portfolio have been each year? What would the average return on the portfolio have been during this period?

c. Calculate the standard deviation of returns for each stock and for the portfolio.

d. Calculate the coefficient of variation for each stock and for the portfolio.

e. Assuming you are a risk-averse investor, would you prefer to hold Stock A, Stock B, or the portfolio? Why?

no excel

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Returns, rB 2011 - 21.60% - 15.00% 2012 24.00 23.50 2013 16.50 33.90 2014 - 1.50 - 7.70 2015 26.50 9.20 Calculate the average rate of return for stock A during the period 2011 through 2015. Round your answer to two decimal places. % Calculate the average rate of return for stock B during the period 2011 through 2015. Round your answer to two...
Problem 6-13 Historical Realized Rates of Return Stocks A and B have the following historical returns:...
Problem 6-13 Historical Realized Rates of Return Stocks A and B have the following historical returns: Year 2012 -24.70% -14.40% 2013 22.75 23.00 2014 11.75 37.10 2015 -2.50 -6.10 2016 31.50 -0.80 Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B. What would have been the realized rate of return on the portfolio in each year? What would have been the average return on the portfolio during this period? Round your answers...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Return rB 2013 -22.70% -15.00% 2014 23.00 16.40 2015 10.25 36.00 2016 -5.75 -9.30 2017 33.50 10.20 Calculate the average rate of return for Stock A during the period 2013 through 2017. Round your answer to two decimal places.______% Calculate the average rate of return for Stock B during the period 2013 through 2017. Round your answer to two decimal places.______% Assume that someone...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Returns, rB 2014 (22.20 %) (16.50 %) 2015 26.75 17.90 2016 14.00 36.90 2017 (3.25 ) (14.60 ) 2018 31.75 23.35 Calculate the average rate of return for each stock during the period 2014 through 2018. Round your answers to two decimal places. Stock A:   % Stock B:   % Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B....
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Returns, rB 2014 (20.90 %) (13.60 %) 2015 27.75 25.40 2016 13.50 39.10 2017 (4.75 ) (5.10 ) 2018 25.50 -4.70 Calculate the average rate of return for each stock during the period 2014 through 2018. Round your answers to two decimal places. Stock A:   % Stock B:   % Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B....
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Returns, rB 2014 (21.20 %) (12.80 %) 2015 34.00 16.00 2016 12.50 34.30 2017 (1.75 ) (14.20 ) 2018 27.50 27.75 Calculate the average rate of return for each stock during the period 2014 through 2018. Round your answers to two decimal places. Stock A:   % Stock B:   % Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B....
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Returns, rB 2013 - 23.90% - 16.20% 2014 30.75 15.00 2015 15.25 20.90 2016 - 1.00 - 9.10 2017 31.50 42.00 Calculate the average rate of return for stock A during the period 2013 through 2017. Round your answer to two decimal places. _______ % Calculate the average rate of return for stock B during the period 2013 through 2017. Round your answer to...
Stocks A and B have the following historical returns: Year 2012 -22.30% -14.50% 2013 25.25 23.30...
Stocks A and B have the following historical returns: Year 2012 -22.30% -14.50% 2013 25.25 23.30 2014 13.00 22.70 2015 -4.75 -6.70 2016 25.25 11.65 Calculate the average rate of return for each stock during the 5-year period. Round your answers to two decimal places. Stock A % Stock B % Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B. What would have been the realized rate of return on the portfolio...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's...
Stocks A and B have the following historical returns: Year Stock A's Returns, rA Stock B's Returns, rB 2014 (22.80%) (12.90%) 2015 28.75 18.70 2016 17.50 30.70 2017 (2.25) (14.20) 2018 28.50 27.40 Calculate the average rate of return for each stock during the period 2014 through 2018. Round your answers to two decimal places. Stock A: ??? % Stock B: ??? % Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B....
You've collected the following historical rates of return for stocks A and B: Year (t) rA,t...
You've collected the following historical rates of return for stocks A and B: Year (t) rA,t rB,t 2016 0.02 0.02 2015 0.08 0.05 2014 0.19 0.07 1. What was the average annual return for stock A 2. What was the average annual return for stock B? 3. What was the standard deviation of returns for stock A? 4.What was the standard deviation of returns for stock B?
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT