Loyola College M.Com Nov 2010 Security Analysis & Portfolio Management Question Paper PDF Download

LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

M.Com. DEGREE EXAMINATION – COMMERCE

THIRD SEMESTER – NOVEMBER 2010

    CO 3802  – SECURITY ANALYSIS & PORTFOLIO MANAGEMENT

 

 

 

Date : 29-10-10                 Dept. No.                                        Max. : 100 Marks

Time : 9:00 – 12:00

 

SECTION – A            Answer ALL questions                                               ( 10 x 2 = 20 )

 

  • What do you mean by ‘return’?
  • What are the two basic investment avenues?
  • What are the precautions to be taken while investing in real estate?
  • What is diversification of portfolio?
  • What are the limitations of CAPM?
  • Highlight the important points of Markowitz model.
  • What is stock split? How the stock price is affected by it?
  • What are tools used for judging undervaluation or overvaluation of investment?
  • Security A and B have standard deviations of 5% and 8%

Mr.X is planning to invest 30% of his funds in security A and the balance in Security B.

Ascertain portfolio risk, if correlation is 1.

  • A company’s return was 20% and that of the stock market as a whole was 15%. The standard deviation of the portfolio was 10%, while that of the market is 5%.  The risk free rate is 6%.  What is the Sharpe measure of the company’s portfolio? Comment on its performance.

 

 

 

 

 

SECTION – B                Answer any five questions                                       ( 5 x 8 = 40 )

 

  • Who is an investor? Bring out his characteristics.
  • Highlight the features of Firm specific analysis under Fundamental factors.
  • What are the obstacles faced by an investment analyst?
  • On what basis efficient market theory is criticized?
  • What are the points to be considered in Portfolio evaluation?
  • Explain the constraints of the investors in formulating their investment objectives.
  • KK invested Rs.10,000 each in shares of X Ltd. and Y Ltd. which carry a risk of 10% and 12% respectively. He had computed the risk of his portfolio as 11% being the weighted average risk. Subsequently on learning about correlation he desires to re-compute the risk of his portfolio.  He finds that the correlation co-efficient between X Ltd. and Y Ltd. is 0.25.  what is the risk of his portfolio?
  • From the following information, calculate the expected rate of return of a portfolio:

Risk free rate of interest 12%; Expected return of market portfolio 18%; standard deviation of an asset 2.8%; market standard deviation 2.3%; correlation co-efficient of portfolio with market 0.8%.

 

 

 

 

 

 

SECTION – C              Answer any TWO questions                                       ( 2 x 20 = 40 )

 

  • How the risk is classified? Explain in brief.

 

  • Bring out the unique features of Technical analysis highlighting its various forms.

 

  • What do you mean by portfolio construction and revision? Identify and discuss the factors contributing to portfolio management.

 

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