A hedge fund manager pursuing a high-risk portfolio construction strategy is least likely to invest in: A. Fixed income security issued by a municipality. B. 52-week Treasury bill. C. Shares of stock in a financial institution. D. An apartment building. Full explain this question and text typing work only We should answer our question within 2 hours takes more time then we will reduce Rating Dont ignore this line. .
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Question A
A hedge fund manager pursuing a high-risk portfolio construction strategy is least likely to invest in:
A. Fixed income security issued by a municipality.
B. 52-week Treasury bill.
C. Shares of stock in a financial institution.
D. An apartment building.
Full explain this question and text typing work only
We should answer our question within 2 hours takes more time then we will reduce Rating Dont ignore this line. .
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- Question a .A mutual fund has a current offering price of 56. 70. What is the net asset value of the fund charges 4.5% front end load? Full explain this question and text typing work only We should answer our question within 2 hours takes more time then we will reduce Rating Dont ignore this lineYou are an employee at XYZ Bank. Your Bank is trying the construct an investment portfolio that matches its resources and goals. To do so, you and your team are required to evaluate the investment options available for your Bank and decide what is the best option to choose. A B C D E Value of the 1,400,500 1,370,050 750,000 450,300 1,700,650 position Duration 5 4 6 YTM 4% 3% 7% 8% 5.50% Potential adverse move 0.30% 0.26% 0.43% 0.56% 0.37% in yield Correlation A. В D E A 1. 0.5 0.3 0.1 -0.2 B 1 0.2 -0.3 0.4 1 0.2 -0.3 D 1. -0.4 E Weight А В D E Scenario I 30.00% 10.00% 60.00% Scenario II 50.00% 30.00% 20.00% Scenario III 50.00% 50.00%Course: FinanceAs a great investor, you are interested in 3 assets to invest: A, B and C. A financial advisor tells you that the returns on the assets are independent of each other, and you are given the following data: Asset A B C E(Ri) 0.05 0.035 0.06 Variance 0.0015 0 0.008 You have not yet analyzed what your degree of risk aversion (A) is, but you know that your utility function behaves as follows: U[ E(Rp)] = E(Rp) - 0.5 * A * Variance. (See attached image for a better understanding) You are asked to:(a) Find the optimal portfolio with these 3 assets {called wA, wB and wC}.b) Calculate the expected return and risk of the optimal portfolio for the following degrees of risk aversion (A):(i) A = 5(ii) A = 10(iii) A = 16 Please ASAP
- You are an employee at XYZ Bank. Your Bank is trying the construct an investment portfolio that matches its resources and goals. To do so, you and your team are required to evaluate the investment options available for your Bank and decide what is the best option to choose. A B C D E Value of the position 1,400,500 1,370,050 750,000 450,300 1,700,650 Duration 5 3 5 4 6 YTM 4% 3% 7% 8% 5.50% Potential adverse move in yield 0.30% 0.26% 0.43% 0.56% 0.37% Correlation A B C D E A 1 0.5 0.3 0.1 -0.2 B 1 0.2 -0.3 0.4 C 1 0.2 -0.3 D 1 -0.4 E 1 Weight A B C D E Scenario I…PLEASE ANSWER ALL THE QUESTIONS Question 1 Fill the parts in the above table that are shaded in yellow. You will notice that there are nine line items. Question 2 Using the data generated in the previous question (Question 1);a) Plot the Security Market Line (SML) b) Superimpose the CAPM’s required return on the SML c) Indicate which investments will plot on, above and below the SML? d) If an investment’s expected return (mean return) does not plot on the SML, what does it show? Identify undervalued/overvalued investments from the graph Question 3 From the information generated in the previous two questions; a) Identify two investment alternatives that can be combined in a portfolio. Assume a 50-50 investment allocation in each investment alternative. b) Compute the expected return of the portfolio thus formed. c) Compute the portfolio’s beta. Is the portfolio aggressive or defensive?Please Answer Question 3 full workout. NO SPREAD SHEET Q1 Fill the parts in the above table that are shaded in yellow. You will notice that there are nine line items. Q2 Using the data generated in the previous question (Question 1) a) Plot the Security Market Line (SML) b) Superimpose the CAPM’s required return on the SML c) Indicate which investments will plot on, above and below the SML? d) If an investment’s expected return (mean return) does not plot on the SML, what does it show? Identify undervalued/overvalued investments from the graph Question 3 From the information generated in the previous two questions; a) Identify two investment alternatives that can be combined in a portfolio. Assume a 50-50 investment allocation in each investment alternative b) Compute the expected return of the portfolio thus formed c) Compute the portfolio’s beta. Is the portfolio aggressive or defensive?
- Blair Rosen. Inc. (BR) is a brokerage firm that specializes in investment portfolios designed to meet the specific risk tolerances of its clients. A client who contacted BR this past week has a maximum of 50,000 to invest. BRs investment advisor decides to recommend a portfolio consisting of two investment funds: an Internet fund and a Blue Chip fund. The Internet fund has a projected annual return of 12%, and the Blue Chip fund has a projected annual return of 9%. The investment advisor requires that at most 35,000 of the clients funds should be invested in the Internet fund. BR services include a risk rating for each investment alternative. The Internet fund, which is the more risky of the two investment alternatives, has a risk rating of 6 per 1,000 invested. The Blue Chip fund has a risk rating of 4 per 1,000 invested. For example, if 10,000 is invested in each of the two investment funds, BRs risk rating for the portfolio would be 6(10) + 4(10) = 100. Finally. BR developed a questionnaire to measure each clients risk tolerance. Based on the responses, each client is classified as a conservative, moderate, or aggressive investor. Suppose that the questionnaire results classified the current client as a moderate investor. BR recommends that a client who is a moderate investor limit his or her portfolio to a maximum risk rating of 240. a. Formulate a linear programming model to find the best investment strategy for this client. b. Build a spreadsheet model and solve the problem using Solver. What is the recommended investment portfolio for this client? What is the annual return for the portfolio? c. Suppose that a second client with 50,000 to invest has been classified as an aggressive investor. BR recommends that the maximum portfolio risk rating for an aggressive investor is 320. What is the recommended investment portfolio for this aggressive investor? d. Suppose that a third client with 50,000 to invest has been classified as a conservative investor. BR recommends that the maximum portfolio risk rating for a conservative investor is 160. Develop the recommended investment portfolio for the conservative investor.A Moving to another question will save this response. Question 28 An investor has $1000 initial wealth for investment and he borrows another $1000 at the risk free rate. He then invest the entire total amount of $2000 in the market portfolio. What is his portfolio beta? 00 O -1.0 +1.0 +2.0 Moving to another question will save this responYou are a portfolio manager who uses options positions to customize the risk profile of your clients. In each case, what strategy is best given your client’s objective?a. ∙ Performance to date: Up 16%.∙ Client objective: Earn at least 15%.∙ Your scenario: Good chance of large gains or large losses between now and end of year.i. Long straddle.ii. Long bullish spread.iii. Short straddle. b. ∙ Performance to date: Up 16%.∙ Client objective: Earn at least 15%.∙ Your scenario: Good chance of large losses between now and end of year.i. Long put options.ii. Short call options.iii. Long call options.
- еВook Problem Walk-Through Suppose you are the money manager of a $3.84 million investment fund. The fund consists of four stocks with the following investments and betas: Stock Investment Beta A $ 320,000 1.50 B 700,000 (0.50) 1,120,000 1.25 D 1,700,000 0.75 If the market's required rate of return is 9% and the risk-free rate is 6%, what is the fund's required rate of return? Do not round intermediate calculations. Round your answer to two decimal places. %Help me pleasetopic: probability and decision making Youre given two investment options: Option A: You invest everything in Posh Spice. You have a 7%chance to earn 90% of your investment, a 10% chance of losing10% of it, and an 83% chance that you will neither win nor lose. Option B: You invest everything in Trust Bank. You’re sure to get7% interest, and there’s no risk of losing money. Which will you go for?