What is the 90-day holding period return of the bill?

Assignment Questions

Q1: Give an example of three financial intermediaries and explain how they act as a bridge between small investors and large capital markets or corporations. [2 Marks]

 

Q2: What are some comparative advantages of investing in the following? [2 Marks]

Unit investment trusts.

Open-end mutual funds.

Individual stocks and bonds that you choose for yourself.

Q3: Q3: The composition of the Alhind Fund portfolio is as follows:

 

Stock   Price
A 300000   $45  
B 500000   50  
C 600000   30  
D 800000   35  

 

The fund has not borrowed any funds, but its accrued management fee with the portfolio manager currently totals $60,000. There are 5 million shares outstanding.

What is the net asset value of the fund?

         

Q4: A U.S. Treasury bill with 90-day maturity sells at a bank discount yield of 9 percent. [4 Mark]

What is the price of the bill?

What is the 90-day holding period return of the bill?

What is the bond equivalent yield of the bill?

What is the effective annual yield of the bill?

 

Note: If using Excel, Students must provide the table of calculations.