Answer Happy

Assignment_Risk & Return During COVID-19 you earned RS. 25,00,000 through online Business. After deducting all the expenses, you have net profit of Rs. 1,50,000. You are planning to invest this saving, and have different options. For instance, he can deposit this money to Salki Muna Certificate paying 12.35% or invest in Pakistan Investment bonds or in Pakistan stock exchange. He just finished risk and return chapter in his Business Finance Course, and you learnt a concept Portfolio which states if you invest in well diversified portfolio, you can earn good profits. You are interested to construct a portfolio of the given stocks but you want to limit your portfolio upto two stocks. B А С D 13 14 Jan 10 15 12 17 14 8 Market KSE-100 35,000 45,000 65,000 55,000 40,000 32,000 11 10 12 Feb Mar Apr May June 12 12 10 13 15 8 10 17 9 12 14 11 1. You are considering all possible combination, please rank all possible options like 1, 2,3,4 or you may argue that some of the combination does not make the sense of portfolio. 2. If the beta of A is 0.23, B is 0.23, C is -0.23 and D is 0.34 then calculate the beta of each combination 3. If you want to invest 1/3 of the investment in stock A and remaining in stock B what would be the return of the Portfolio. 4. Calculate the real time Beta of Stock A, Stock B, Stock, C and Stock D 5. By using the calculated Beta's in Step 4 then calculate the required rate of Return on Stock A, B, C and D. Pakistan Investment Bonds Maturity Yield 5- years 9.16% 10-years 9.82% 15-Years 10.40%