John Stewart has recently joined ABC
in the capacity of an investment advisor. As a way to attract additional
clients, John has asked for your help in preparing some educational material
for a seminar taking place later this month.
He has asked you put together a
report on the following investments and calculate the returns of these
investments (including dollar values and percentages) to illustrate how they
Perform the 5 calculations
listed below:Show all of your work as well
as any formulas that you used.If you used MS Excel to arrive
at your answers, then you must provide an explanation of your
that does not pay a dividend of which you buy 100 shares for $25.00 per share
and sell the 100 shares for $27.50 per share a year later. You pay the $50.00
commission when you sell the securities.
bond that you purchase for $1,000 pays a 6% yearly rate. It is paid
semiannually, and you hold the bond until maturity.
current yield on a bond that is priced at $89 has a 6% coupon.
yield-to-maturity (YTM) on a 7.25% ($1,000 par value) bond that has 10 years
remaining to maturity, currently trading in the market at $825.
holding period return (HPR) for 1,000 shares of a no-load mutual fund
currently selling at an NAV of $11, purchased a year ago at an NAV of $10.50
per share, including $300 of distributed investment income dividends and
capital gains dividends of $350.
Next, answer the following
questions:Explain systematic and
unsystematic (also known as nonsystematic) risk.What are the different types
of investments a person can make?Explain a stock’s beta
coefficient and how it ties into systematic versus unsystematic risk.What are the
differences between the various types of bonds?What do bond ratings indicate,
and what 2 major agencies are in charge of assigning these ratings?Compile your calculations, MS
Excel tables and explanations (if applicable), and your responses to
the 5 points above into a single Word document.