Questions from Personal Finance


Q: X Co. has the latest 12 months’ earnings per share (

X Co. has the latest 12 months’ earnings per share (EPS) of $2.50, expected EPS in the current year of $3.00, and normalized EPS of $4.00. If its current stock price is $20, solve for its three P/E mu...

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Q: What are the advantages of a passive approach to investing?

What are the advantages of a passive approach to investing?

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Q: How has mutual fund performance compared with overall indexes? Why do

How has mutual fund performance compared with overall indexes? Why do you think that is the case?

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Q: How are income taxes determined for mutual funds?

How are income taxes determined for mutual funds?

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Q: Stock A and stock B have no correlation. Does that mean

Stock A and stock B have no correlation. Does that mean we don’t have to include correlation in calculating portfolio return? Explain.

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Q: Mary purchased a home for $200,000. By living

Mary purchased a home for $200,000. By living in the home, she saved $18,000 annually because she did not have to pay rent. She had to pay $3000 annually for upkeep of the home. By the end of the firs...

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Q: Stocks C and D move in opposite directions. Does that mean

Stocks C and D move in opposite directions. Does that mean they have no correlation? Explain.

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Q: Under the EMH, can you outperform the market?

Under the EMH, can you outperform the market?

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Q: Under the weak form of the EMH, if you are given

Under the weak form of the EMH, if you are given the following recent day price performance: is the likely future performance higher than nine? Why?

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Q: Under the semi strong form of the EMH, should you read

Under the semi strong form of the EMH, should you read an annual report? Why?

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