Question two [ 40 marks ] Consider the following Price and Dividend data relatin
ID: 2774574 • Letter: Q
Question
Question two [ 40 marks ] Consider the following Price and Dividend data relating to two stocks that are held in a portfolio. Below are the stock prices and the dividends of Berger during 2009 to 2014: Date Price ($) Dividend ($) respectively - December 31, 2009 $71.56 December 31, 2010 $89.44 $0.10 December 31, 2011 $87.75 $0.10 December 31, 2012 $69.00 $0.10 December 31, 2013 $69.06 $0.10 December 31, 2014 $72.69 Consider the following Price and Dividend data for Seprod Company Limited during 2009 to 2014: Date Price ($) Dividend ($) December 31, 2009 $24.89 December 31, 2010 $26.46 $0.25 December 31, 2011 $20.19 $0.25 December 31, 2012 $6.40 $0.25 December 31, 2013 $10.40 $0.25 December 31, 2014 $12.20 $0.25 Required: a. Calculate Seprod Company Limited's annual returns during 2009 to 2014 for Berger Paints Limited [10 marks] b. Calculate Seprod Company Limited's annual returns during 2009 to 2014 for Seprod Limited[ 6 marks] c. Calculate the standard deviation of the returns for each company during the period 2009 to 2014 respectively [
Explanation / Answer
SOLUTION :
Berger Paints Limited
Year
Price
Dividend
ANNUAL RETURN
(annual return - average)^2
a
b
C
d=(ending price-beg price+div)/beg Price
e
2009
71.56
0
2010
89.44
0
24.99
552.13
2011
87.75
0.1
- 1.78
10.67
2012
69
0.1
- 21.25
517.21
2013
69.06
0.1
0.23
1.58
2014
72.69
0
5.26
14.20
Total
7.44
1,095.78
Average
1.49
standard deviation= square root of (sum of column e/n-1)
16.55
Seprod Company Limited
Year
Price
Dividend
ANNUAL RETURN
(annual return - average)^2
a
b
C
d=(ending price-beg price+div)/beg Price
E
2009
24.89
2010
26.46
0.25
7.31
46.74
2011
20.19
0.25
- 22.75
539.49
2012
6.4
0
- 68.30
4,730.23
2013
10.4
0.25
66.41
4,346.86
2014
12.2
0.25
19.71
370.03
Total
2.38
10,033.34
Average
0.48
standard deviation= square root of (sum of column e/n-1)
50.08
Berger Paints Limited
Year
Price
Dividend
ANNUAL RETURN
(annual return - average)^2
a
b
C
d=(ending price-beg price+div)/beg Price
e
2009
71.56
0
2010
89.44
0
24.99
552.13
2011
87.75
0.1
- 1.78
10.67
2012
69
0.1
- 21.25
517.21
2013
69.06
0.1
0.23
1.58
2014
72.69
0
5.26
14.20
Total
7.44
1,095.78
Average
1.49
standard deviation= square root of (sum of column e/n-1)
16.55
Seprod Company Limited
Year
Price
Dividend
ANNUAL RETURN
(annual return - average)^2
a
b
C
d=(ending price-beg price+div)/beg Price
E
2009
24.89
2010
26.46
0.25
7.31
46.74
2011
20.19
0.25
- 22.75
539.49
2012
6.4
0
- 68.30
4,730.23
2013
10.4
0.25
66.41
4,346.86
2014
12.2
0.25
19.71
370.03
Total
2.38
10,033.34
Average
0.48
standard deviation= square root of (sum of column e/n-1)
50.08
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