Download BU (Bangalore University) MBA 4th Semester 2016 July Investment Analysis Management Question Paper

Download BU (Bangalore University) MBA (Master of Business Administration) 4th Semester 2016 July Investment Analysis Management Question Paper

'IIIIIII PG - 926
IV Semester MBA. 099m Examination. July 2016
(0368)
MANAGEMENT
Paper - 4.2.1 : lnvostmeht Analysis and ?angemem
Time : 3 Hours V Max. Marks : 70
SECTION - A
Answer any ?ve questions. Each question carries ?vo marks : (55:25)
1. Distinguish between Inveshnems and speculation.
2. What Is ef?cient market hypothesis ?
3. Discuss vatious types of risk with exacmhe.
4. Sekhat has a portfolio of ?ve stocks with the 10!!ovving expected market value
and returns.
Stock: Market value Return
A 20.000 10%
8 25.000 18%
c 30.000 15%
D 1.00.000 12%
E 1.000 8%
1.76.000
Determine their expected return.
9.7.0.

PG-m e l-IIIII! ?
5. Mr. Arjunen received a bonus oi Rs. 50,000 from his company. He wants to
inveetthe moneylntwostocks. Atteracaretul studyotthe stoekemarkethe
seiected?odm?ReedComom?onsTheexpectedretumhRodqsnsMpewem
and standard deviation 01 return is 22 percent. 1119 return from the Read Corp(G)
is slightiy hlgherbetng 16 percent and atthe sametime the standard deviation of
return is also highe: being 25 percent. The correlation coefficient between them
is 0.5. Help him to build a minimum risk porttoiio.
6. The X/Y Company stock?s return depends heavily on the market return. the
beta being 1.4. the risk free rate of return is 8 pecbent and the Market return is
15 percent.
a) Determine the expected return for XY stock.
b) What happens to expected return, it the market return increases to
20 percent ?
c) What happens to the retum ii beta falls to .90 while the other Inputs remain
the same 7
7. Describe the CAPM model. Give the signi?cance at SML and CML.
SECTION - B
Answer any three questions. Each question carries ten marks : (3x10-30)
8. Explain the Matkowttz model of portfolio analysis and selection.
9. Distinguish between Fundamental analysis and Technical analysis.
10. Sun Rise Company manages two mutual tunds. The funds are Index Fund and
Equity Fund. The data below provide the key statistical inionnation.
Return per cent Rink Beta r
Equlty Fund 19 18 1.49 .33
hdex Fund 13 16 1.08 .68
Market 14 10 1.0 1.00
n, 5
3) According to Jensen method which tund pertorms well.
b) In your opinion. which fund consists more at systematic tisk.
c) What is the meaning oi alpha in Jensen method 7

f IIIIIIII 4 913-925
11. Determtne the relationship between assets R and S return with the following
data :
pmub'my at Annual Returns
occumnoo H s
02 - 8 ? - 9
0.4 12 - 4 ?
0.3 ? 6 10
0.1 9 ? 11
SECTION ? C
Case study: (11:15:15)
12. A pontotlo manager has got the following information about several stocks. He
has to build a optimum porttotlo tor his client without short sales :
Securtty Expected return 3 o:
A 22 1.0 35
B 20 2.5 30
C 14 1.5 25
D 18 1.0 80
E 18 0.8 20
F 12 1.2 10
G 19 1.6 25
H _ 17 2.6 30
The market index variance is 12 percent and the risk tree rate 01 return Is
7 percent.