Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. 21. you manage a portfolio which has a beta of 0.7

21. You manage a portfolio which has a beta of 0.7 and the portfolio is...

60.1K

Verified Solution

Question

Accounting

image
21. You manage a portfolio which has a beta of 0.7 and the portfolio is worth 4 m completely hedge your portfolio, you decide to trade S&P 500 futures contracts. Each con worth 250 per index points. How many contracts you need to buy sell if the S&P 500 index htly at $12 index porrortfolio, you beta of 0.7 s. How muccide to trade de portfolio ir dobio is worth $4 million. In order to ontracts. Each contract is 22. Suppose the return on a market portfolio is 11% and a risk free rate is 3%. What is the dividend yield of a stock which has a beta = 0.75, the stock paid $0.80 dividend and is expected to grow at a con- stant rate of 4% per year? 23. The exchange rate between the US dollar (USD) and the Euro (EURO) was 1 USD = 0.8 EURO at the beginning of year 2018. Over the year, US inflation was 3% while the inflation rate in Europe was 1%. What should be the exchange rate at the end of 2015, if purchasing power parity holds

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students