Download JNTU-Hyderabad MBA 3rd Sem R17 2019 Dec 743AF Security Analysis And Portfolio Management Question Paper

R17

Code No: 743AF

JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD

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MBA III Semester Examinations, December - 2019

Time: 3 hours

SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT

Max.Marks:75

Note: This question paper contains two parts A and B.

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Part A is compulsory which carries 25 marks. Answer all questions in Part A. Part B consists of 5 Units. Answer any one full question from each unit. Each question carries 10 marks and may have a, b, c as sub questions.

PART - A

5×5 Marks = 25

1. Write a short note on the following:
   1. Preferential Allotment of shares [5]
   2. YTM and YTC [5]

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   3. Efficient Frontier [5]
   4. Economic Value added Approach [5]
   5. Covered call and straddle [5]

PART - B

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5 × 10 Marks = 50

2. a) Explain the investment environment in India.
   b) Differentiate between Investment and Speculation. [5+5]

   OR

3. a) Briefly explain the Securities Institutions viz. NSE, SEBI and NSDL, which provide greater scope for Indian Stock Market [6+4]
   

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   b) Explain about Margin Trading.

4. a) What is Beta and how can you measure risk through Beta?
   b) A Bank is managing a Portfolio of Stocks with the following Market Values and Betas (ẞi). Find the Beta of the Portfolio:- [5+5]
   Stocks: P1 P2 P3 P4 P5
   Market Value (RS.): 1,00,000 2,00,000 3,00,000 2,50,000 1,50,000
   

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   Betas (βi): 1.1 1.6 0.8 1.2 2.0

   OR

5. a) Briefly explain the Capital Market Line (CML) Concept, with the diagram and the formula.
   b) What are the assumptions of CAPM Model? [5+5]

6. a) What is a Bond? Briefly explain: i) Bond Volatility; and ii) Bond Convexity.
   

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   b) The face value of a bond is Rs. 1000/- coupon rate of 8% life of bond is 5 years and the market price of bond is Rs. 1042/-. Compute YTM of this bond. [5+5]

   OR

7. a) Xavier purchased, at par, a Bond with a face value of Rs.1000, at 10% Coupon Rate, having 5 years to maturity. The bond was called 3 years later, for a price of Rs.1, 300, after making the second annual interest payment. Xavier then reinvested the proceeding in a Bond selling at its face value of Rs. 1, 000, with 3 years to maturity and 8% Coupon Rate. What is Xavier's YTM over the 5-year period?
   b) Explain Bond Duration. [5+5]

8. a) What is Equity Valuation? Briefly explain: i) Liquidation Value; and ii) Free Cash Flow Model.
   

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   b) Discuss the types of Mutual Funds in India. [5+5]

   OR

9. a) Differentiate between Fundamental and Technical Analysis.
   b) Write briefly about Efficient Market Hypothesis. [5+5]

10. a) Compare and contrast Futures and Forward contract.
    

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    b) What are the assumptions of Black and Scholes option pricing model? [5+5]

    OR

11. a) Explain about NAV, Expense ratio, Fund of Funds.
    b) From the following data, Calculate Sharpe's Index and Interpret the result:-
    Portfolio X: Expected Return Rp = 15%; σρ = 5%
    

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    Portfolio Y: Expected Return Rp = 20%; σρ = 6%
    Risk-free Rate of Return (Rf) = 10%. [5+5]

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