Business, 25.11.2021 14:00 daty0355

Isaac has a $900,000 fully diversified portfolio. He subsequently inherits TURE Company common stock worth $100,000. His financial adviser provided him with the following forecast information: The Expected Monthly Returns for original portfolio and TURE company are 0.23% and 1.45%. The Standard Deviation of Monthly Returns of original portfolio and TURE company are 2.37% and 2.95%. The correlation coefficient of TURE stock returns with the original portfolio returns is 0.40. Assume she does this, what is the expected return of her new porfolio which includes the government securities. Covariance of the government security returns with the original portfolio returns. Standard deviation of her new portfolio which includes the government securities. Based on the conversations with her husband, she is considering selling the $100,000 of ABC stock and acquiring of XYZ company common stock instead. XYZ stock has the same expected return and SD as the ABC stock. Her husband comments, "it doesn't matter whether you keep all of ABC stock or replace it with $100,000 of XYZ stock". Required:
Is her husband's comment correct or incorrect?

Answers: 1

Show answers

Another question on Business

Business, 21.06.2019 21:30

The following account balances at the beginning of january were selected from the general ledger of fresh bagel manufacturing company: work in process inventory $0 raw materials inventory $ 28 comma 100 finished goods inventory $ 40 comma 600 additional data: 1. actual manufacturing overhead for january amounted to $ 65 comma 000. 2. total direct labor cost for january was $ 63 comma 400. 3. the predetermined manufacturing overhead rate is based on direct labor cost. the budget for the year called for $ 255 comma 000 of direct labor cost and $ 382 comma 500 of manufacturing overhead costs. 4. the only job unfinished on january 31 was job no. 151, for which total direct labor charges were $ 5 comma 200 (1 comma 300 direct labor hours) and total direct material charges were $ 14 comma 400. 5. cost of direct materials placed in production during january totaled $ 123 comma 700. there were no indirect material requisitions during january. 6. january 31 balance in raw materials inventory was $ 35 comma 300. 7. finished goods inventory balance on january 31 was $ 35 comma 400. what is the cost of goods manufactured for january?

Answers: 3

Answer

Business, 22.06.2019 18:30

Health insurance protects you if you experience any of the following except: a: if you have to be hospitalized b: if you damage someone's property c: if you need to visit a clinic d: if you can't work because of illness

Answers: 2

Answer

Business, 22.06.2019 19:10

Greenway industries is a major multinational conglomerate. its business units compete in a range of industries, including home appliances, pharmaceuticals, commercial real estate, and plastics manufacturing. although its largest business unit, which produces kitchen appliances, is among the most profitable in the industry, it generates only 35 percent of the company's revenues. which of the following is most likely true of greenway's stock price? a. it is valued at less than the sum of its individual business units. b. it is valued at greater than the sum of individual business units. c. it is valued at the exact sum of individual business units. d. it is consistently lower than the industry average.it is valued at greater than the sum of individual business units.

Answers: 1

Answer

Business, 22.06.2019 21:10

Which of the following statements is (are) true? i. free entry to a perfectly competitive industry results in the industry's firms earning zero economic profit in the long run, except for the most efficient producers, who may earn economic rent. ii. in a perfectly competitive market, long-run equilibrium is characterized by lmc < p < latc. iii. if a competitive industry is in long-run equilibrium, a decrease in demand causes firms to earn negative profit because the market price will fall below average total cost.

Answers: 3

Answer

You know the right answer?

Isaac has a $900,000 fully diversified portfolio. He subsequently inherits TURE Company common stock...

Questions