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Based on the scenarios below, what is the expected return for a portfolio with the following...

Based on the scenarios below, what is the expected return for a portfolio with the following return profile? Market Condition Bear Normal Bull Probability .2 .3 .5 Rate of return -25% 10% 24% Use the following scenario analysis for Stocks X and Y to answer CFA Problems 3 through 6 (round to the nearest percent). Bear Market Normal Market Bull Market Probability 0.2 0.5 0.3 Stock X -20% 18% 50% Stock Y -15% 20% 10% 3. What are the expected rates of return for Stocks X and Y? 4. What are the standard deviations of returns on Stocks X and Y? 5. Assume that of your $10,000 portfolio, you invest $9,000 in Stock X and $1,000 in Stock Y. What is the expected return on your portfolio? 6. Probabilities for three states of the economy and probabilities for the returns on a particular stock in each state are shown in the table below. State of Economy Probability of Economic State Stock Performance Probability of Stock Performance in Given Economic State Good .3 Good .6 Neutral .3 Poor .1 Neutral .5 Good .4 Neutral .3 Poor .3 Poor .2 Good .2

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Home nert Page Layout Formulas Data Review View dd-Ins s Cut aCopy E AutoSum Wrap Text в 1 프 . Ej-., Δ. : rーー 逻锂函Merge & Center. $, % , 弼,8 C Conditional Format CeInsert Delete Format Formatting as Table Styles2 Clear Sort &Find & Format Painter Clipboard Alignment Number Cells Edting U120 118 119 120 121 122 123 124 125 CFA PROBLEMS 126 127 128 129 130 131 132 133 134 135 136 11 1 ト capm-portfolio, retirement futures 1 PROBABILITYRETURN EXPECTED RETURN 0.2 0.3 0.5 25% 10% 24% -5.00% 3.00% 12.00% 10.00% EXPECTED RETURN- PROBABILITY RETURNRETURN EXPECTED RETURN VARIANCE P 0.2 0.3 0.5 20% 18% 50% -15% 20% 10% -4% 5% 2 5% 26% FORX FORY (X-26)A2 4.3059% 0.2117% 2.7848% P*(T-8)A2 1.0580% 0.4320% 0.0200% BEAR NORMAL BULL -3% 6% 5% 8% EXPECTED RETURN- VARIANCE 7.3024% 3% 1.5100% 196 4 STANDARD DEVIATION-SQRT (VARIANCE) FVANNUITY ACCCVP KE BOND HPR REALISED YIELD PV ROE std costin ECONOMY, BEFORE AFTERBUYBACK Shell . 1 · 1 13-01-2019Home nert Page Layout Formulas Data Review View dd-Ins Cut Σ AutoSum ー E ゴWrap Text ta copy. B า 프 . Ej-., Δ. : r_一 逻锂函Merge & Center. $, % , 弼,8 Conditional Format CeInsert Delete Format Formatting as Table Styles2 Clear Sort &Find & Format Painter Clipboard Alignment Number Cells Edting N149 136 137 138 139 140 141 142 143 144 145 146 147 148 149 150 151 152 153 154 11 1 ト capm-portfolio, retirement futures 5 STOCK INVESTMENT WEIGHT RETURN PORTFOLIO RETURN A*B 9000 1000 10000 09 0.1 26.40% 8.00% 23.76% 0.80% 24.56% PORTFOLIO RETURN- 25% 6 VALUES ARE NOT ARRANGED PROPERLY AND NOT WRITTEN WHAT TO FIND OUT FV, ANNUITY ACCCVP KEBOND HPR REALISED YIELD NPV ROE std costin ECONOMY, BEFORE AFTERBUYBACK Shell 06:41 13-01-2019

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