Investment Analysis

 Investment Research Essay

37. В В You get 300 stocks of Qualitycorp for $30 per reveal and put in initial margin of fifty percent. В In the morning Qualitycorp's home value drops to $25 per reveal. В What is your actual perimeter? В В В В В В В В В В В A)В В 50%

B)В В 40%

C)В В 33%

D)В В 60%

E)В В 25%

Answer: BВ В Difficulty: ModerateВ В

Rationale: AM sama dengan [300 ($25) -. 5 (300) ($30)] / [300 ($25)] sama dengan. 40 В

30. Assume that you purchased two hundred shares of Super Performing mutual pay for at a net property value of $21 every share. In the past year you received dividend income distributions of $1. 40 per share and capital gains distributions of $2. 85 every share. At the conclusion of the season the stocks had a net asset benefit of $23 per discuss. What was your rate of return within this investment? A) 30. 24% B) twenty-five. 37% C) 27. 19% D) 22. 44% E) 29. 18% Answer: Problems: Moderate Rationale: R = ($23-21+1. 5+2. 85)/$21 sama dengan 30. 238% 31. Imagine you purchased stocks and shares of High Traveling mutual finance at a net advantage value of $12. 60 per talk about. During the year you received dividend income distributions of $0. 78 every share and capital benefits distributions of $1. 67 per reveal. At the end from the year the shares a new net advantage value of $13. 87 per talk about. What was your rate of return with this investment? A) 29. 43% B) 30. 56% C) 31. 19% D) thirty-two. 44% E) 29. 18% Answer: N Difficulty: Average Rationale: Ur = ($13. 87-12. 50+0. 78+1. 67)/$12. 50 sama dengan 30. 56% 32. Imagine you purchased shares of a shared fund for a net asset value of $14. 50 per share. In the past year you received dividend cash flow distributions of $0. 28 per reveal and capital gains allocation of $0. 65 per share. At the conclusion of the yr the shares had a net asset value of $13. 74 per share. What was your charge of returning on this expenditure? A) installment payments on your 91% B) 3. 07% C) 1 ) 10% D) 1 . 78% E) -1. 18% Response: C Problems: Moderate Explanation: R = ($13. 74-14. 50+0. 27+0. 65)/$14. 50 = 1 . 103%

12-15. You want to evaluate three common funds using the Sharpe evaluate for performance evaluation. The risk-free come back during the sample period is usually 6%. The regular returns, common deviations and betas for the three money are given below, as is the information for the S& S 500 index.

The fund with the highest Sharpe assess is __________.

A) Fund A

B) Fund M

C) Fund C

D) Funds A and W are tied for highest

E) Funds A and C are tied for maximum

Answer: C Problems: Moderate

Rationale: A: (24% -- 6%)/30% sama dengan 0. sixty; B: (12% - 6%)/10% = 0. 60; C: (22% -- 6%)/20% = 0. 85; S& S 500: (18% - 6%)/16% = zero. 75.

SHARPE, TREYNOR AND JENSEN'S PERCENTAGES

SHARPE RATIO

This proportion measures the return earned in excess of the danger free price (normally Treasury instruments) on the portfolio for the portfolio's total risk as measured by the standard deviation in its results over the way of measuring period. Or how much better did you are doing for the risk assumed.

S sama dengan Return portfolio- Return of Risk free expense

Regular Deviation of Portfolio

Example: Let's assume that we look at a one year time period where a catalog fund returned 11% Treasury bills attained 6%

The standard change of the index fund was 20%

Therefore S = 11-6/. 20 sama dengan 25

The Sharpe ratio is definitely an appropriate way of measuring performance to get an overall profile particularly when it truly is compared to another portfolio, yet another index such as the S& P 500, Little Cap index, etc .

That said however , it is not generally provided for most rating services.

TREYNOR RATIO

This proportion is similar to these except it uses beta rather than standard deviation. It's also referred to as Reward to Volatility Percentage, it is the percentage of a fund's average excess return to the fund's beta. It steps the comes back earned around those that could have been earned on a riskless expenditure per product of market risk presumed.

To = Return of Portfolio - Return of Safe Investment

Beta of Portfolio

The absolute risk adjusted go back is the Treynor plus the risk-free rate.

Assume two portfolios A B

Return...


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