You estimate that a passive portfolio, that is, one invested in a risky portfolio that mimics the s& p 500 stock index, yields an expected rate of return of 12% with a standard deviation of 25%. you manage an active portfolio with an expected return of 19% and a standard deviation of 32%. the risk-free rate is 7%. your client's degree of risk aversion is a = 3.3.

a.
if he chose to invest in the passive portfolio, what proportion, y, would he select? (do not round intermediate calculations. round your answer to 2 decimal places. omit the "%" sign in your response.)

proportion of y %? ?

b. what is the fee (percentage of the investment in your fund, deducted at the end of the year) that you can charge to make the client indifferent between your fund and the passive strategy affected by his capital allocation decision (i. e., his choice of y )? (do not round intermediate calculations. round your answer to 1 decimal place. omit the "%" sign in your response.)

fee % per year

Profits from using currency options and futures. on july 2, the two-month futures rate of the mexican peso contained a 2 percent discount (unannualized). there was a call option on pesos with an exercise price that was equal to the spot rate. there was also a put option on pesos with an exercise price equal to the spot rate. the premium on each of these options was 3 percent of the spot rate at that time. on september 2, the option expired. go to the oanda. com website (or any site that has foreign exchange rate quotations) and determine the direct quote of the mexican peso. you exercised the option on this date if it was feasible to do so. a. what was your net profit per unit if you had purchased the call option? b. what was your net profit per unit if you had purchased the put option? c. what was your net profit per unit if you had purchased a futures contract on july 2 that had a settlement date of september 2? d. what was your net profit per unit if you sold a futures contract on july 2 that had a settlement date of september 2

Increases in output and increases in the inflation rate have been linked to

Below are the steps in the measurement process of external transactions. arrange them from first (1) to last (6). event step post transactions to the general ledger. assess whether the transaction results in a debit or credit to account balances. use source documents to identify accounts affected by an external transaction. analyze the impact of the transaction on the accounting equation. prepare a trial balance. record the transaction in a journal using debits and credits.