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## Portfolio Analysis

by: Casimer Wisoky

23

0

4

# Portfolio Analysis FIN 4315

Casimer Wisoky
UTEP
GPA 3.69

Zuobao Wei

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COURSE
PROF.
Zuobao Wei
TYPE
Class Notes
PAGES
4
WORDS
KARMA
25 ?

## Popular in Finance

This 4 page Class Notes was uploaded by Casimer Wisoky on Thursday October 29, 2015. The Class Notes belongs to FIN 4315 at University of Texas at El Paso taught by Zuobao Wei in Fall. Since its upload, it has received 23 views. For similar materials see /class/231269/fin-4315-university-of-texas-at-el-paso in Finance at University of Texas at El Paso.

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Date Created: 10/29/15
CHAPTER 1 ANSWERS TO PROBLEMS HPR Ending Value Beginning Value 7050 14 2 HPYHPR1705011410440 3 HPR Ending ValueBeginning Value 793951 15567 4 Annual HPR HPR 15567 5 10925 Annual HPY Annual HPR 1 10925 1 00925 925 Time Price of X Tech Return 1 HPR 30194 5100 30195 5800 137 1137 30196 6612 14 114 30197 7405 12 112 30198 7235 23 0977 30199 7939 973 10973 1 N 71371412239737 5 Arithmetic Mean WEI Hay 7 5 7 93943 N UN 6 Geometric Mean 111 HPR 1 1137114112097710973 5 1 10925 1 00925 925 7 ERi 025 5 0505 02515 5 8 c 025 5 52 0505 52 02515 5z 2 707 9 CV Standard Deviation of ReturnsExpected Rate of Return 7075 141 The table provided below can be used to obtain answers for 10 to 13 Weighted StockSharesPricetMVtPricet1MVt1 HPR HPYWeight HPY 1 20 11 220 14 280 127 027 029 0058 2 35 13 455 17 595 131031 071 0048 675 875 0106 10 HPY for stock 1 280220 7 1 27 27 11 HPY for stock2 5954557 1 31 31 12 Market weight for stock 1 220675 33 33 Market weight for stock 2 455675 67 67 13 Portfolio HPY 3327 6731 297 297 CHAPTER 3 1 Large company risk premium 112 38 74 2 Small stock risk premium 124 112 12 3 Horizon premium 53 38 15 4 Default premium 58 53 05 CHAPTER 4 1 Letting X total investment Jackie39s share will represent 50 percent Thus SOX 45000 and X 45000 50 90000 At 25 per share she can purchase 90000 25 3600 shares 2 Pro t 40 253600 54000 3 Margin Market Value Debit Balance Market Value where Debit Balance initial loan value 90000 45000 45000 Market Value Price X Number of Shares 3600P Thus 030 3600P 45000 3600P 1080P 3600P 45000 P 1786 4 Letting P price and Q quantity of shares Heidi s share of the investment will 40 of PQ Thus 040PQ 50000 and PQ 50000 040 125000 At 50 per share she can purchase 125000 50 2500 shares 5 Pro t 80 502500 75000 6 Margin Market Value Debit Balance Market Value where Debit Balance initial loan value 125000 50000 75000 Market Value Price X Number of Shares 2500P Thus 025 25007P 75000 2500P 625P 2500P 75000 P 4000 7 Pro t Total Return Repurchase Cost Transaction Costs Interest Total Return Beginning Market Value Dividend 3225 75 315000 Repurchase cost 28375 X 100 283750 without transaction costs Transaction Costs 45 55 10000 Interest 09 X 0453225 13061 Pro t 3150 283750 100 13061 8189 8 Rate of Return Pro t Initial Investment Initial investment 55 X 3225 177375 Rate of Return 8189177375 462 9 Rate ofretum 554508511009045090 1928 10 Rate ofretum 354508507009045090 2342 11 Rate ofretum 5545085110090 17545062507545090 2351 12 Rate ofretum 3545085070090 17545062507545090 3305 13 030 150P 7 04515050150P P 3214 CHAPTER 5 1 January 13 indeX25 40 303 3167 2 January 14 adjusted divisor 25 40 6 X 3167 X 22419 3 January 14indeX25 427224193301 4 January 15 indeX 27 42 8 22419 3435 5 January 16 divisor 135 42 8 X 3435 X 18486 6 January 16indeX1444 10 184863678 20 21 January 13 index 100 by de nition Base Value 251000 402000301000 135000 January 14 Value 251000 422000 75000 144000 Index 144000 135000 x 100 10667 January 15 Value 271000 422000 85000 151000 Index 151000 135000 x 100 11185 January 16 Value 142000 442000 105000 166000 Index 166000 135000 x 100 12296 The Arithmetic Average is 10 12 10 11 6 5 98 The Geometric Average is 11011211011110615 1 978 The Arithmetic Average is 8 10 14 20 10 5 28 The Geometric Average is 10811086120915 1 199 Price weighted series Dec 2000 75 150 25 404 725 Post split series 725 375 75 25 40X The new divisor X 24483 Price weighted series Dec 2001 50 65 35 5024483 8169 Return on series 8169 7 725725 1268 Value weighted series Dec 2000 750000 750000 500000 1000000 x100 100 750000 750000 500000 1000000 Value weighted post split 100 Not affected by splits Value weighted series Dec 2000 1000000 650000 700000 1250000 750000 750000 500000 1000000 xlOO 120

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