Questions from General Investment

Q: You are constructing a portfolio of two assets. Asset A has

You are constructing a portfolio of two assets. Asset A has an expected return of 12 percent and a standard deviation of 24 percent. Asset B has an expected return of 18 percent and a standard deviati...

Q: You are given the following information concerning a stock and the market

You are given the following information concerning a stock and the market: Calculate the average return and standard deviation for the market and the stock. Next, calculate the correlation between th...

Q: You have been given the following return information for two mutual funds

You have been given the following return information for two mutual funds (Papa and Mama), the market index, and the risk-free rate. Calculate the Sharpe ratio, Treynor ratio, Jensenâ€
...

Q: A Treasury bill that settles on May 18, 2016, pays

A Treasury bill that settles on May 18, 2016, pays $100,000 on August 21, 2016. Assuming a discount rate of 0.44 percent, what are the price and bond equivalent yield?

Q: You have a car loan with a nominal rate of 5.

You have a car loan with a nominal rate of 5.99 percent. With interest charged monthly, what is the effective annual rate (EAR) on this loan?

Q: Explain the difference between the Sharpe ratio and the Treynor ratio.

Explain the difference between the Sharpe ratio and the Treynor ratio.

Q: A Treasury bond that settles on August 10, 2016, matures

A Treasury bond that settles on August 10, 2016, matures on April 15, 2021. The coupon rate is 4.5 percent and the quoted price is 106:17. What is the bond’s yield to maturity?

Q: A bond that settles on June 7, 2016, matures on

A bond that settles on June 7, 2016, matures on July 1, 2036, and may be called at any time after July 1, 2026, at a price of 105. The coupon rate on the bond is 6 percent and the price is 115.00. Wh...

Q: A Treasury bond that settles on October 18, 2016, matures

A Treasury bond that settles on October 18, 2016, matures on March 30, 2035. The coupon rate is 5.30 percent and the bond has a 4.45 percent yield to maturity. What are the Macaulay duration and modif...

Q: Most sources report alphas and other metrics relative to a standard benchmark

Most sources report alphas and other metrics relative to a standard benchmark, such as the S&P 500. When might this method be an inappropriate comparison?