An Investor Is Concerned with the Risk Associated with a Portfolio

question 70

Essay

An investor is concerned with the risk associated with a portfolio of stocks.He draws a random sample of nine monthly returns (expressed as a percentage of the initial investment).These data follow: 2,5,-6,10,1,2,-3,0,and 7.Find a 95% confidence interval estimate of the population variance.

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Definitions:

Real Rate Of Return

The annual percentage of profit earned on an investment, adjusted for changes in the inflation rate.

Shareholders

Individuals or entities that own shares in a corporation, making them partial owners and entitling them to a portion of the company's profits.

Corporate Bond

A type of debt security issued by a corporation to raise capital, promising to pay back the face value, along with interest, to the bondholders.

Primary Market

The market in which financial institutions aid in the sale of new securities.