What are the proceeds of $9500 at 12% discount for 8 months?
Answers: Could it be $8360 (£4266.19 - €5733.47) ?
I don't really get the question!
12% discount would usually mean an annual rate, so here is the straight 12%, and then the 12% annual:
proceeds = 9500/1.12 = $8,482.14 (straight 12%)
proceeds = 9500/ 1.08 = $8,796.30 (annualized 12%)
(discounting something means finding how much it is worth ~Right Now~ if it can grow to the stated amount with the stated interest rate... so basically, if someone would give you $9,500 in 8 months, and you expected a 12% annual return, then you would be willing to pay them right now $8,796.30)
If compounded monthly:
1) $9500/(1 + .12/12)^8
2) $9500/(1.01)^8
3) $9500/1.082856
4) = $8773.09 is the Present Value ($8773.09 invested today at 12% compounded monthly, will have a $9500 balance after 8 months)
What are the proceeds of $9500 at 12% discount for 8 months?
The proceeds in this situation can have two results (as far as the owner of question didn't tell about the contract condition if it is capitalized every month or not (complex method)):
so,
1) 9500*(12*8/12)/100=760 the last result 9500+760=10.260$
2)9500+ (9500*1/100) = 9595 - the first month
9595+ (9595*1/100) = 9690.95
9690.95+ (9690*1/100) = 9787.85
9787.85 + (9787.85*1/100) = 9885.73
9885.73 + (9885.73*1/100) = 9984.58
= 10084.42
= 10185.26
= 10287.11 - the last result.
If someone knows the forumla of how to find the complex method the easy way, please let me know.
Stock Diversity?
How diverse should my portfolio be? How many stocks should i hold? Mutual Funds? DRIP?Answers: It's not how many, it's how different. If you have for example a Fidelity large-cap growth fund and a Vanguard large-cap growth fund, you aren't really any more diversified than having purely one.
To be truly diversified, you have to enjoy investments that differ in type. Here are some differences you might want to consider:
- stocks vs bonds vs bread
- domestic vs international stocks
- large-cap vs mid-cap vs small-cap
- growth vs value
It's not that you involve to have without doubt one of each, but the more diversified you are, the better your overall investments will hold up contained by the long-term. and you won't be as inclined to panic during a bazaar downturn, either.
For purposes of diversification, stocks can scrounging individual stocks or mutual funds or ETFs. But it doesn't add much to your diversification to own, for example, a single large-cap mutual fund and also a brokerage account next to Coke and Berkshire.
It's easier to become diversified via mutual funds. For example, if you pile all of your money into one of those target retirement funds, you'll be more diversified than most population. But I have both stock funds, bond funds, REITs, and individual stocks... and I'm justly well diversified but not as all right as I could be.
The other thing to point out is that if you are looking at long-term investing, and mainly if you're young, afterwards you don't have to verbs as much about short-term fluctuations contained by the market. So you can mass your asset allocations more to the investments with the unbeatable average returns (small-cap stocks, emerging markets, etc.). But since these fluctuate more, have some of your money also in investments that may rise as others dip, can facilitate smooth out the fluctuations and help your long-term goal.
William Bernstein has a couple of excellent books out roughly this topic.
Even farmers will tell you not to put adjectives of your eggs in one picnic basket. The idea of diversifying is push button in any investment, because a broader catalogue of investments reduces the overall risk of investing. For crop growing, to ensure a bright future contained by egg production, a farmer might enjoy different types of chickens, maybe even some goose eggs, and hold more than one basket to bring in the eggs. When it comes to stocks and bonds, investors have to be merely as savvy. There is no trick or magical method to conjuring up the perfect diverse portfolio that will guarantee financial nouns. However, an investment portfolio that is okay diversified is more likely to bring investors nouns than one that is not. With that within mind, let's take a look at how to build a diverse portfolio.
Making Diverse Investments
An investment portfolio can lone be considered "diverse" if it consists of multiple different types of investments. When thinking of investments, the most common types that come to mind are stocks, bonds, and mutual funds. It's critical not to forget to have other types within your portfolio. For example, do not forget about bread investments. Usually shorter term investments, or something as simple as putting money surrounded by a savings information, it's important to preserve a small amount invested in brass.
Another type of investment that is sure to include some diversity to your collection is real estate. Houses, condominiums, properties, parkland - they can all be sensible investments. Unlike cash, unadulterated estate tends to let go returns in the long occupancy. Having at least a small percentage of your investments surrounded by real estate creates asset diversity for your portfolio.
In the history of the world at hand was a time when gold ingots was more precious than any weekly currency. Do not forget that natural resources close to gold, silver, and other precious metals can be investments, too. Natural gas, oil, and petroleum are other natural resources to consider.
When considering bonds, remember that here are multiple types of bonds to choose from. To make a diverse portfolio work, choose to invest within government bonds as resourcefully as corporate bonds. Remember to choose corporate industries that are not necessarily reliant on government contracts, as economically.
Evaluate Your Mutual Fund Investments
Mutual fund stocks are essential to any investment portfolio, but even the types of mutual fund investments you choose to make should be diverse. First, it is noteworthy to check the type of mutual funds to ensure that they are all strong choices, but surrounded by differing industries.
Next, it would be a perfect idea to evaluate respectively of them to determine what type of returns you expect from them. Discover if the mutual fund is a growth type or a value type. A growth mutual fund is imperfect by the company's ability to grow its proceeds faster than other companies in like industry. Their stocks have a lofty expected growth potential. The other type to look out for is a value mutual fund, and they include strong companies whose stock is currently undervalue in the open market by other investors. Having a good mix of expediency and growth mutual fund investments will reduce your risk and effectively diversify your portfolio.
Mix up the Industries
Finally, when it comes to stocks and securities, remember to other be on the lookout for different industries. Keep it mixed up. Do not invest in companies that are adjectives located in one geographic region. Have some international investments next to solid companies in financially stable countries. Also remember not invest merely in technology or individual in textile. Broaden the range of industries included within your portfolio to maximize diversity. Choosing to do so will make your investments adjectives the more a sure thing.
Buying a mutual fund would automatically diversify your investment. A typical mutual fund holds stocks contained by over 30 different companies.
Diversifying is over rated. Diversifying doesn't guarantee investment nouns but buying the best stocks possible does guarantee success.
Who desires to diversify if you pick winners. Diversifying is a strategy to protect yourself against losers
Since not a soul is perfect at picking winner. Your real strategy is to own the best stocks possible, within the best businesses. You could own a bank stock similar to Bank of America, a personal products company like Proctor and Gamble, a utility stock close to Pacific Gas & Electric and oil company similar to Exxon, a technology stock like Intel, a drug stock close to Merck, a multinational like General Electric and so on.
Drips are my favorites coupled next to optional change payments in utility companies, close to Duke energy, but Drips are not a catch rich quick strategy but a nouns way to invest over the long permanent status in a exact, methodical manner.
The internet is rich within good investment guidance. Do a search on DRIPs, Diversifying investments and Dividends. Good Luck.
Best Regards,
Kurt
at hand is a'' model portfolio theory''.....it recommends roughly speaking 20 stocks
Want points? Please help out me answer this.?
Suppose your risky portfolio includes the following investments in the given proportions:Stock A 27%
Stock B 33%
Stock C 40%
What are the investment proportions of this client's overall portfolio, including position surrounded by T-Bills?
What is the reward-to-volatility ratio (SA) of your risky portfolio and your client's overall portfolio?
Thanks for the help everyone.i'll be checking put money on continuously and giving out a best answer soon.
Answers: your question give no information...
You have 3 ""risky??"" stocks
No mention of T-bills
Reward?... to what volitility??
Stock A, B, and C may be risky but not necessarily volitile
If you don't similar to this answer. ask a better question.
This must be a query for a class report huh? My guess is that this client's portfolio is in the ruins. I see zilch solid not even T-Bills today. The American dollar has shrunken drastically. Take stockA and re-invest into a wet day funds fund like IRAs. Take stock B and buy further T-Bills, that way stock C become all T-Bills that will someday sustain the economy strenghten and grow when the US currency strenghtens again..;~)lol