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The annualized volatility of the WTI futures is 17% and the correlation coefficient is 0.68. Calculate the variance-minimizing hedge ratio.
Greyhorse is willing to provide $1 million fundings in exchange for a share of the common stock. What is the ownership interests based on this VC financing?
Numerically demonstrate the intrinsic values and moneyness ranges for the options using a range of plausible exercise (strike) prices and premiums.
A bond is currently trading at a YTM of 11%. We also know that its market price is $803, and that its coupon. What is the bond's expected Capital Gains Yield?
Assuming you could get 1,300 shares in Koepka and 1,300 shares in Johnson, what would your profit be? What profit do you actually expect?
If you were not required by law to purchase minimum levels of insurance, would you use insurance as a form of asset protection? Why/why not?
Calculate the expected utility of the three prospects. What is the equation of the indifference curve passing through lottery A?
Explain and discuss the process ofsecuritisation. Explain how credit default swaps are constructed and discuss their application in hedging and speculation.
Identify objections or rationalisations that could be encountered for both options highlighted above. Discuss the possible responses to these objections.
To estimate the cost of capital you have been provided with the following data: rRF= 5.00%; RPM= 6.00%. Based on the CAPM approach, what is the cost of equity?
Choose 2 additional components on each of the sheets and provide your initial impression on the company financial situation. Do you think you could handle this?
What is the present value of an investment that promises to pay the investor $10,000 at the end of each year for the next 5 years if the investor desires a 9%?
Treasury bid and ask quotes are sometimes given in terms of yields, so there would be a bid yield and an ask yield. Which do you think would be larger? Explain.
Now assume that the required rate of return increased to 9%. Would you recommend investors to buy the bond?
You are required to evaluate each payment method and suggest your preferred method with workings.
How much more do you need to invest per month to have $1M at retirement? Why is this amount so much greater than the difference between 20 and 25?
What would happen to the price of a three-year coupon-paying bond, with a face value of $100 and a coupon rate of 10% per annum.
One year later, the bond is called by the issuer at $1020 due to the good interest rate. What is the Yield-to-Call?
Find the portfolio's Macaulay duration. Express your answer in years with two digits after the decimal point.
You own a stock that had total returns of -6.52, 5.92, 6.99, 7.09, -5.79, 5.07, over the last seven years. What is the arithmetic average return for this stock?
You make a $1,300.00 down payment and have a fair credit score. How much interest is due at the end of the first month?
What's the difference between corporate bonds and government bonds? Why are corporate bonds important in a firm's capital structure with citations and source?
Calculate the current annual interest rates, and the expected future dollar-pound spot rate in one year assuming parity holds.
What were your 2 biggest expense categories? How could you save some money in each category?
What is your levered cost of equity? What is one bond provision that might make you less worried in this situation?