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    Kazi Abdur Rahman Rafi 56-D 3932

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    kazi A.R Rafi
    The document contains calculations and analysis of two assets, Asset A and Asset B, from 2017 to 2019. It also examines a portfolio consisting of 50% of each asset. It calculates the [1] average annual returns for each asset and portfolio, [2] the annual and average returns for the portfolio, [3] the standard deviation of returns for each asset and portfolio, and [4] the coefficient of variation for each. It determines that Asset A would be preferred to hold due to its lower risk of returns.

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    Kazi Abdur Rahman Rafi 56-D 3932

    Uploaded by

    kazi A.R Rafi
    28 views3 pages
    The document contains calculations and analysis of two assets, Asset A and Asset B, from 2017 to 2019. It also examines a portfolio consisting of 50% of each asset. It calculates the [1] average annual returns for each asset and portfolio, [2] the annual and average returns for the portfolio, [3] the standard deviation of returns for each asset and portfolio, and [4] the coefficient of variation for each. It determines that Asset A would be preferred to hold due to its lower risk of returns.

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    kazi abdur rahman rafi 56-D 3932 (2)

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    The document contains calculations and analysis of two assets, Asset A and Asset B, from 2017 to 2019. It also examines a portfolio consisting of 50% of each asset. It calculates the [1] average annual returns for each asset and portfolio, [2] the annual and average returns for the portfolio, [3] the standard deviation of returns for each asset and portfolio, and [4] the coefficient of variation for each. It determines that Asset A would be preferred to hold due to its lower risk of returns.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    28 views3 pages

    Kazi Abdur Rahman Rafi 56-D 3932

    Uploaded by

    kazi A.R Rafi
    The document contains calculations and analysis of two assets, Asset A and Asset B, from 2017 to 2019. It also examines a portfolio consisting of 50% of each asset. It calculates the [1] average annual returns for each asset and portfolio, [2] the annual and average returns for the portfolio, [3] the standard deviation of returns for each asset and portfolio, and [4] the coefficient of variation for each. It determines that Asset A would be preferred to hold due to its lower risk of returns.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    Question1 Calculate the average rate of return for each asset during the

    period 2017 through 2019.


    year Asset A (%) Asset A (%)
    2017 10.00 15.00
    2018 -20.00 35.00
    2019 40.00 -30.00
    Total 30.00 20
    Number of years 3 3
    Average rate of 10 6.67
    returns

    Answer to the question no i

    Question2: Assume that someone held a portfolio consisting of 50% of


    Asset A and 50% of Asset B. What would the realized rate of return on the
    portfolio have been each year? What would the average return on the
    portfolio have been during this period?

    Answer to the question no ii

    year Asset A Asset B Portfolio return calculation Realized rate


    (%) (%) of return

    2017 10.00 15.00 (.50 x 10%) + (.50 x 15%) 12.5%


    2018 -20.00 35.00 (.50 x (-20%)) + (.50 x 35%) 7.5%
    2019 40.00 -30.00 (.50 x 40%) + (.50 x (-30%)) 5%
    Total 25%
    Number of years 3
    Average rate of returns 8.3
    Question3 Calculate the standard deviation of returns for each asset and
    for the portfolio.

    Answer to the question no iii

    year Asset A (%) Asset B (%) Portfolio (%)


    2017 10.00 15.00 12.5
    2018 -20.00 35.00 7.5
    2019 40.00 -30.00 5
    Standard 30 33.3 3.81
    deviation

    Question 4 Calculate the coefficient of variation for each asset and for the
    portfolio.

    Answer to the question no iv

    year Asset A (%) Asset B (%) Portfolio


    2017 10 15 12.5
    2018 -20 35 7.5
    2019 40 -30 5
    Standard deviation 30 33.29164059 3.818813079
    Mean 10 6.666666667 8.333333333
    Coefficient variation 3 4.993746089 0.458257569

    Question5: Would you prefer to hold Asset A, Asset B, or the portfolio?


    Why?
    Answer to the question no v

    I would like prefer to hold asset A because of risk of return.

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