Investment and portfolio management

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  1. Section I is compulsory
  2. Attempt any 3 questions from section II
  3. Your assumptions and working notes shall form part of your answer

 

Section I

Q.1) Explain in brief the following                                                                                          (15)

  1. Technical analysis
  2. Dividend discount model
  3. Initial public offer
  4. Investment and speculation
  5. Present value of annuity

Q.2)     You are the portfolio management’s services. An investor approaches you to seek your advice on deploying hiss surplus funds of Rs.30 lacs in various investments’. He   is  ready to bear the risk of 40% of his investments .he desires to get regular income as  well as fair return at the end if he holds the investments for a period of 5 years. You are required     to make an investment plan for him and construct a portfolio using    various investments             alternative.                                                                                                                   (15)

Section II

Q.3) Discuss the role of SEBI for investor’s protection.                                                                      (10)

 

Q.4) what is technical analysis? How it is different from fundamental analysis.                                 (10)

 

Q.5)     a) Mr. Mehta plans for his daughter marriage after 6 years. He expects the cost of the  marriage to be Rs.10,00,000. How much he saves annually to have a sum of Rs.10, 00,000 at the end of 6 years. If interest rate is 8%                                                                     (5)

 

b)Mrs. Vaidehi purchased 400 shares of jai hind ltd. @Rs. 50 on each on 10 Feb,2008. She             paid brokerage of Rs.200. she received dividend from the company as follows.                (5)

June 2008              150

June 2009              300

June 2010              450

She sold all her holdings on 12th Feb. 2011 for Rs.34000- what is her holding period return?

 

Q.6) MNO’s ltd. Share is quoted @ Rs.20 on BSE currently. The company pays Rs. 1 per share as   dividend and investor expects a growth rate of 5% per year compute                                                                                                                                               (10)

I.          Expected rate of return

II.         If the anticipated growth is 6% p.a., calculate the indicative market price.

III.       Advice on the basis of indicative market price computed above whether it is profitable to invest in the shares of MNO ltd. At its current price on BSE.

Evaluate and comment on the following securities with the help of Sharpe’s Treynor and Jenson measure;

YEAR

RETURNS

  SECURITY N SECURITY O MARKET

2003

2004

2005

2006

2007

17

19

12

18

22

20

17

07

19

24

15

18

20

22

19

17

19

08

15

18

BETA

0.7358

1.2461

0.2409

1

Risk free rate of return is 7%.

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