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1. Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
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or
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ASSIGNMENT
DRIVE FALL 2016
PROGRAM MBADS – (SEM 3/SEM 5) / MBAN2 / MBAFLEX – (SEM 3) /
PGDFMN – (SEM 1)
SUBJECT CODE & NAME MF0010 & SECURITY ANALYSIS AND PORTFOLIO
MANAGEMENT
SEMESTER 3
BK ID B 1754
CREDITS 4
MARKS 60
Note: Answer all questions. Kindly note that answers for 10 marks questions should be
approximately of 400 words. Each question is followed by evaluation scheme.
Q.1 Financial markets bring the providers and users in direct contact without any intermediary.
Financial markets permits the businesses and governments to raise the funds needed by sale of
securities. Describe the money market/capital market – features and its composition.
Ans : Money market- features and composition :
AccordingtoInvestopedia,themoneymarketisasubsectionof thefixedincomemarket.Fixedincome
oftenisconsideredthe same thingas bondsorinvestmentsthathave aspecificsetreturnratherthan
a variable one. A money market is an efficient investment arena for businesses, governments and
otherlarge institutions,butitalsoprovidesextrasafetyandliquidityforindividual investors.A money
market is the best place for
Q.2 Risk is the likelihood that your investment will either earn money or lose money. Explain the
factors that affect risk. Mr. Rahul invests in equity shares of Wipro. Its anticipated returns and
associated probabilities are given below:
Return -15 -10 5 10 15 20 30
Probability 0.05 0.10 0.15 0.25 0.30 0.10 0.05
You are required to calculate the expected ROR and risk in terms of standard deviation.

2. Answer : Factors that affect risk :
1. The actual investment you're considering:
Differentinvestmentscarrydifferentlevelsof risk.Allinvestmentsinvolveadegreeof riskandreturns
can neverbe guaranteedsoitisimportanttochoose investmentsthatsuit yourcircumstances.Below
is a table that illustrates a range of investment types and their associated risks
Q.3 Explain the business cycle and leading coincidental & lagging indicators. Analyse the issues in
fundamental analysis.
Ans : Explanation of business cycle:
The termbusinesscycle (oreconomiccycle or boom-bustcycle) referstoeconomy-wide fluctuations
in production, trade and economic activity in general over several months or years in an economy
organizedonfree-enterprise principles.The businesscycle isthe upwardand downwardmovements
of levelsof GDP (gross domesticproduct) and refersto the periodof expansionsandcontractionsin
the level of economic activities (business fluctuations
Q.4 Discuss the implications of EMH for security analysis and portfolio management.
Ans : The Efficient market Hypothesis (EMH) term appeared in the 1960's thanks to Eugene Fama
(Beechey et al., 2000) He defined an efficient market as one that can quickly adjust to the new
information.TwentyyearslaterFamahadmodifiedhisdefinitionbysayingthatthe marketisefficient
if it incorporates all the information that is available, it means that efficient markets are acting
rationally - relevantinformationisincorporatedandthereare nosystematicerrorsmadebyinvestors.
In 1968 Jensen noticed that the
Q.5 Explain about the interest rate risk and the two components in it.
An investor is considering the purchase of a share of XYZ Ltd. If his required rate of return is 10%,
the year-end expected dividend is Rs. 5 and year-end price is expected to be Rs. 24, Compute the
value of the share.
Ans : Introduction of interest rate risk :
Interest rate risk is the risk that arises for bond owners from fluctuating interest rates. How much
interest rate risk a bond has depends on how sensitive its price is to interest rate changes in the
market. The sensitivity depends on two things, the bond's time to maturity, and the coupon rate of
the bond. There are a number of standard calculations for

3. Q.6 Elucidate the risk and returns of foreign investing. Analyse international listing.
Ans : Explanation of all the points in risks and returns from foreign investing :
Investing internationally has often been the advice given to investors looking to increase the
diversificationandtotal returnof theirportfolio.The diversificationbenefitsare achievedthroughthe
additionof lowcorrelationassetsof international marketsthatserve toreduce the overall riskof the
portfolio. However, although the benefits of investing internationally are widely accepted theories,
manyinvestorsare stillhesitanttoinvestabroad.Inthisarticle,we'lldiscussthe reasonswhythismay
be the case and help highlight key
Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
help.mbaassignments@gmail.com
or
call us at : 08263069601