BFC3241 Equities and Investment Analysis
BFC3241代写 1.Which of the following items is considered as a profitability measure? a. Days sales in inventory b. Return on assets ···
1.
Which of the following items is considered as a profitability measure?
a. Days sales in inventory
b. Return on assets
c. Price-earnings ratio
d. Cash coverage ratio
e. Fixed asset turnover
2. BFC3241代写
An investor can allocate his/her wealth across two risky assets shown in the table below:
The covariance of returns between A and B is 0.004. The investor wishes to construct a portfolio that is the minimum variance combination of these two assets. Calculate the expected return of this minimum variance portfolio.
a. 0.1200
b. None of the options are correct.
c. 0.1308
d. 0.2687
e. 0.1589
3. BFC3241代写
You invest $100 in a risky asset with an expected rate of return of 0.11 and a standard deviation of 0.21 and a T-bill with a rate of return of 0.045. The slope of the capital allocation line formed with the risky asset and the risk-free asset is equal to:
a. 0.41667
b. 0.3095
c. 0.8000
d. None of the options are correct.
e. 0.4667
4.
The market portfolio has an expected return of 10% p.a. and a standard deviation of returns of 20%. The risk-free rate of return is 5% p.a.An investor is currently holding a market index fund. She is deciding whether to add any of the following stocks to her current holding and to maintain the same risk level and has been provided with the following data:
Advise which, stock(s) is best suitable for the investor to add to her portfolios:
a. Stock C
b. Stock D
c. Stock B
d. Stock A
e. Both Stocks C and D
5. BFC3241代写
Assume you bought 100 shares of common stock at $70 per share. The initial margin is 50%. What would be the maintenance margin if a margin call is made at a stock price of $55?
a. 40.5%
b. 36.4%
c. 28.6%
d. 57.1%
e. 63.6%
6.
You have invested in an asset that has the following expected returns across the three potential states of the economy over the next year:
Calculate the expected return and standard deviation of this asset (correct to one decimal place).
a. Expected return = 4.3%; Standard deviation = 7.9%
b. None of the options are correct.
c. Expected return = 4.1%; Standard deviation = 7.9%
d. Expected return = 4.3%; Standard deviation = 6.7%
e. Expected return = 4.1%; Standard deviation = 6.7%
7. BFC3241代写
Which of the following variables reflects the incremental economic effect from using debt?
a. The effective interest rate after tax
b. The effective tax rate
c. Operating ROA – effective interest rate after tax
d. ROE
8.
Assuming a leveraged ETF that promises to pay 3X the benchmark, and the benchmark offered a positive return at the end of the day of 15%. If the initial NAV is 100. How much does the ETF need to rebalance assuming no entry/exit of flows to the fund?
a. 70
b. 90
c. 50
d. 40
9. BFC3241代写
You purchased Caulfield Ltd stock at $50 per share. The stock is currently selling at $65. Your gains may be protected by placing a
a. market order
b. stop-buy order
c. limit-buy order
d. limit-sell order
e. day order
10. BFC3241代写
Consider a binomial tree with one future period (T=0,1) in which the price can go up to 27 or decrease to 16. The price of the asset at T=0 is 20, and there is an equal chance that it goes up or down at T=1. The investor starts with an initial wealth of 1,000. The risk-free asset yields a return of zero percent.What is the wealth of the investor at T=1 if the asset price drops, and the investor short-sells and takes a negative position on the risky asset equal to 1,800?
a. 840
b. -840
c. 1360
d. -1360
None of the above
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