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(A)Use @Risk with 100 Replications,provide a Summary Statistics of Portfolio

Question 61

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(A)Use @Risk with 100 replications,provide a summary statistics of portfolio return; namely,minimum,maximum,mean,and standard deviation.
(B)Use your answers to (A)to estimate the probability that Mrs.Smart's portfolio's annual return will exceed 20%.
(C)Use your answers to (A)to estimate the probability that Mrs.Smart's portfolio will lose money during the course of a year.
(D)Suppose that the current price of each stock is as follows: stock 1: $16; stock 2: $18; stock 3: $20; and stock 4: $22.Mrs.Smart has just bought an option involving these four stocks.If the price of stock 1,six months from now are is $18 or more,the option enables Mrs.Smart to buy,if she desires,one share of each stock for $20 six months from now.Otherwise the option is worthless.For example,if the stock prices six months from now are: stock 1: $18; stock 2: $20; stock 3: $21; and stock 4: $24,then Mrs.Smart would exercise her option to buy stocks 3 and 4 and receive (21- 20)+ (24-20)= $5 in each cash flow.How much is this option worth if the risk-free rate is 8%?

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