Question

the market rate of return in the U.S. using the S&P 500 return for 2019 was...

the market rate of return in the U.S. using the S&P 500 return for 2019 was =30.43%

how did i get this answer? please show me

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

The market rate of return could be calculated by opening price on the first day of the year and then it is to be deducted by the closing price at the end of the year. The difference between the both will be the total return earned on a particular index .

To calculate the Market rate of the index we will divide difference between the two by the opening value of the index to arrive at percentage return on the index which would be said as market rate of return on index.

30.43% which is the market rate of return on S&P500, it has been calculated without taking into account any dividend reinvestment because if one account for the dividend dividend reinvestment, the market rate of return on S&P500 would be 33.07%.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
The S&P 500 index of U.S. stocks has an expected return of 0.10 and a variance...
The S&P 500 index of U.S. stocks has an expected return of 0.10 and a variance of 0.04, and the index of Emerging Market stocks has an expected return of 0.08 and a variance of 0.03. Their correlation is 0.25 and the risk-free rate is 0.03. What is your optimal allocation to the Emerging Market stocks if you maximize your tradeoff between portfolio expected return and variance, your risk aversion is 3, and you do not face any financial constraints?...
Portfolio Risk and Return. Suppose that the S&P 500, with a beta of 1.0, has an...
Portfolio Risk and Return. Suppose that the S&P 500, with a beta of 1.0, has an expected return of 13% and T-bills provide a risk-free return of 4%. (LO12-2) a. What would be the expected return and beta of portfolios constructed from these two assets with weights in the S&P 500 of (i) 0; (ii) .25; (iii) .5; (iv) .75; (v) 1.0? b. On the basis of your answer to (a), what is the trade-off between risk and return, that...
What should we use for expected market return? 10-year arithmetic average return of S&P 500 index....
What should we use for expected market return? 10-year arithmetic average return of S&P 500 index. 10-year geometric average return of S&P 500 index. 80-year arithmetic average return of S&P 500 index. 80-year geometric average return of S&P 500 index.
You are attempting to forecast the return of the S&P 500 under a variety of economic...
You are attempting to forecast the return of the S&P 500 under a variety of economic scenarios. You have determined that there is a 10% chance of the U.S. entering a recession, a 70% chance of the U.S. experiencing normal growth and 20% chance of the U.S. experiencing above-normal growth. You expect the S&P 500 to return -20%, +8% and +30% returns under each of these scenarios. What is your expected return for the S&P 500? 5.2% 6.0% 9.6% 13.6%...
The S & P 500 is a collection of 500 stocks of publicly traded companies. Using...
The S & P 500 is a collection of 500 stocks of publicly traded companies. Using data obtained from Yahoo!Finance, the monthly rates of return of the S & P 500 from 1950 through 2015 are normally distributed. The mean rate of return is 0.007443 and the standard deviation is 0.04135.   What is the probability that a randomly selected month has a positive rate of return? That is, what is P(X > 0)? What is the probability that the mean...
Suppose that the S&P 500, with a beta of 1.0, has an expected return of 10%...
Suppose that the S&P 500, with a beta of 1.0, has an expected return of 10% and Treasury bills provide a risk-free return of 4%. a. How would you construct a portfolio from these two assets with an expected return of 8%? Specifically, what will be the weights in the S&P 500 versus T-bills b. How would you construct a portfolio from these two assets with a beta of 0.4? c. Find the risk premiums of the portfolios in (a)...
Suppose that the S&P 500, with a beta of 1.0, has an expected return of 10%...
Suppose that the S&P 500, with a beta of 1.0, has an expected return of 10% and T-bills provide a risk-free return of 4%. a. How would you construct a portfolio from these two assets with an expected return of 8%? Specifically, what will be the weights in the S&P 500 versus T-bills? b. How would you construct a portfolio from these two assets with a beta of 0.4? c. Find the risk premiums of the portfolios in (a) and...
The S&P 500 and the Dow Jones Industrial Average indices are proxies for the broader US...
The S&P 500 and the Dow Jones Industrial Average indices are proxies for the broader US stock market. You notice one day that the S&P 500 closed UP by 0.20%, while the DJIA closed DOWN by 0.20%. Explain how it is possible for one proxy (S&P 500) to have a positive return while the other (DJIA) has a negative return on any given day. Include in your explanation some names that could have caused this discrepancy. Which return (S&P 500...
1. What should we use for expected market return? a. 10-year arithmetic average return of S&P...
1. What should we use for expected market return? a. 10-year arithmetic average return of S&P 500 index. b. 10-year geometric average return of S&P 500 index. c. 80-year arithmetic average return of S&P 500 index. d. 80-year geometric average return of S&P 500 index.
The? risk-free rate is 4.3?% and you believe that the? S&P 500's excess return will be...
The? risk-free rate is 4.3?% and you believe that the? S&P 500's excess return will be 11.9?% over the next year. If you invest in a stock with a beta of 1.2 ?(and a standard deviation of 30?%), what is your best guess as to its expected excess return over the next? year? The expected excess return over the next year is ____%. ?(Round to two decimal? places.)
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT