Week 4 Assignment

Chapter 24 Question24-2 page 964 earnest A has an expected make up of return of 6%, a standard departure of returns of 30%, a correlation coefficient with the market of-0.25, and a genus of import coefficient of -0.5. warranter B has an expected return of11%, a standard release of returns of 10%, a correlation with the market of0.75, and a genus Beta coefficient of 0.5. Which security is more risky? Why? Using SML: rA= rrf + (rm rrf)bi Security A is riskier because of its negative correlation to the market. Also its of import is negative causing to believe its risk will join on over time. Chapter 24 Question24-8 page 966-967 You are given the following(a) scar of data: Historical Rates of Return Year deep board air Y 1 4.0% 3.0% 2 14.3 18.2 3 19.0 9.1 4 -14.7 -6.0 5 -26.5 -15.3 6 37.2 33.1 7 23.8 6.1 8 -7.2 3.

2 9 6.6 ! 14.8 10 20.5 24.1 11 30.6 18.0 Mean =9.8% 9.8% ? = 19.6% 13.8% a. Construct a scatter plat arrangementing the relationship between returns on Stock Y and the market. Use a spreadsheet or a calculating machine with a linear regression function to estimate genus Beta. ? = 0.62 b. let out a verbal interpretation of what the regression line and the beta coefficient show about Stock Ys excitability and sexual intercourse risk as compared with...If you want to discombobulate a full essay, order it on our website: BestEssayCheap.com

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