Study Session 2: Quantitative Methods: Basic Concepts
Since English is not my mother tongue, please bear with me on this.
Given the below 2 paragraphs, what’s the difference between “A lump sum with interim cash” and “A lump sum with no interim cash”?
The Future Value of a Lump Sum with Interim Cash Reinvested at the Same Rate
Does anyone have any fancy mnemonic or fancy way of remembering all of the various yield formulas for BDY, HPY, MMY, EAY, etc.? I know these aren’t brain busters, but I hate having to sit here and think, “wait - which one is which again?”
Please, help me to understand the mathematical logic behind the money market yield.
Here is the equation:
money market yield = [ 360 x r BD ] / [360 - (t x rBD)]
where rBD is the band discount rate; t - days till maturity.
rMM = (360)(0.05)/[360 − (120)(0.05)] = 0.0508
Here is how I started interpreting the math (but stumbled):
1) in the numerator we have 360 x bank discount rate = 360 x 0.05 = 18; this seems to give the number of periods within a year, during which 0.05 could be earned; is that so?
Can I calculate the variance of this data set:
W1 = 0.2
W2 = 0.4
W3 = 0.4
X1 = 10
X3 = 20
Using Texas calculator.
I know we can use Stats and then Data functionality . I just want to know if we can plug in Weights ?
Lets say I have the following returns for four quarters
Q1: 4% Q2: 3% Q3: 6% Q4: 4%
If I wanted to find the calendar year return, would I sum the above returns (4+3+6+4) or multiply (1.04*1.03*1.06*1.04)?
15. For a lump sum investment of $250,000 invested at a stated annual rate of 3% compounded daily, the number of months needed to grow the sum to $1000,000 is closest to -
The calculation in answer section seems to be difficult. Why they calculated Effective Annual Rate first? Even use of Ln and shown answer is inconsistent. Would you please give me a fresh solution?
Thanks in Advance.
Someone please tell me how to solve this question.
Q. Among 900 taxpayers with income below $100,000, 35 were audited by the IRS. The probability that a randomly chosen individual with an income below $100,000 was audited is ???
Here is a statistical report
# Portfolio’s Deviations from Benchmark Return, 2003-2014 (%)\
2003 - 2.48 2008 - N.89
2004 - N2.59 2009 - N9.19 N* Denotes ( negative number)
2005 - 9.47 2010 - N5.11
2006 - N.55 2011 - 1.33
2007 - N1.69 2012 - 6.84
2013 - 3.04 2014 - 4.72
What would be the cumulative relative frequency for the interval -1.71% ≤ x <2.03% ?
Calculating PV and FV of different cash flows:
This is the current value of some future cash flow.
- The longer the time period till the future amount is received, the lower the present value.
- Higher the discount rate, the lower the present value.
This is the value to which an investment will grow after one or more compounding periods.
HI, guys, as I studying ime-weighted rate of return, there is something I don’t understand,
An investor purchases a share of stock at t=0 for $100. At the end of year, t=1, the investor buys another share of the same stock for $120, at the end of year 2, the investor sells both shares for $130 each. At the end of both year 1 and 2, the stock paid a $2 per share dividend, what is the annual time-weighted rate of return for this investment?
step 1: Holding period 1: beginning value =$100
dividend paid =$2