Section 1: Multiple Choice: Clearly indicate your selection. [3 points each]
l. On December 16, 2010, Swift Transportation Co (SWFT) conducted in Initial Public Offering
(1P0) in which the company sold 73.3 million shares at $11 per share. Morgan Stanley
Assignment 3
Investment and Portfolio Management
Instructor: Jason Levine
Spring 2014
Due date: Tuesday, February 18
1. The expected returns and standard deviation of returns for two securities are as
follows:
Security Z Security Y
Expected Return
15%
35%
Assignment 4
Investment and Portfolio Management
Instructor: Jason Levine
Spring 2014
Due date: Tuesday, March 4 at 11:59:59pm
1. Stock MPQ has a volatility of 25% and i = 0.7. The market has volatility of 15%.
(a) How much idiosyncratic volatility does t
FIN 3101, Fall 2013
Problem Set #1
Directions: The problem set is due by 4 PM on Tuesday October 1, 2013. Problem sets may be turned
in to me during class or delivered to my office by the deadline. Any students working together must turn
in one set of sol
FIN 3101, Fall 2012
Problem Set #1
Directions: All problem sets are due by 3 PM on Tuesday October 2, 2012. Any students working
together must turn in one set of solutions for that group with all group members names on that copy.
Group size is limited to
8.1 Motivation
In practice, stock indices are often used:
1. To summarize the performance of either: (1) the stock market of
a given region/country (e.g., Europe/US); or (2) a segment of
this market (e.g., small stocks).
8. Market Indices and ETFs
2. As
Formula Sheet: Midterm Exam
NAME: _
Tax-equivalent yield = tax exempt yield / (1 T)
1
r
N
r
N
r (1 rt )
t 1
2
1 N
2
r rt
N 1 t 1
N
t 1
t
1
N
1
1 N
2
r rt
N 1 t 1
N
E ( R p ) i E ( Ri ) 1 E ( R1 ) . N E ( RN )
i 1
N
2
P
i 1
12
N
j 1
i
j
i j
i, j
5.1 Buying on Margin
Suppose that you:
have $50;
borrow $50; and
buy one share that is priced at $100.
5. Buying on Margin
and Short Selling
5-2
5.1 Buying on Margin
5.1 Buying on Margin
Suppose that you:
have $50;
borrow $50; and
buy one share th
12.1 Risk-Free Security
Treasury Bills with a maturity equal to the investment period are
nominally risk-free (assuming a zero default probability).
As noted in an earlier lecture:
12. Risk-Free Borrowing and Lending
The correlation between the returns o
Formula Sheet: Final Exam
NAME: _
FINA 3101, Investment Analysis
2 xN
P( y)
t 1
MD
CPN t
1 y
2
t
PAR
1 y
2
2 xN
dP( y ) 1
dy
P
ED dP 1 P 1 P ( y ) P ( y ) 1
dy P
y P
y y
P
N
MDP i MDi
i 1
(1 z 0 xN / 2) N (1 z 0 xN 1 / 2) N 1 (1 f N 1xN / 2), where N
FIN 3101 Problem Set 2
Due Date: 3 PM, October 23, 2012 with no exceptions.
Ground Rules:
Students may work independently or in groups of up to three other students.
Each group should turn in one write-up per group. If you work in groups, do not turn in
IPOs
Financial Management and
Dr.Markets
Khaled Sherif
Chapter Outline
What is an IPO?
An initial public offering, or IPO, is the first sale of stock by a
company to the public.
A company can raise money by issuing either debt or equity. If the
company