jinall classes
tybms prelim paper
time : 2.5 hr    investment analysis & portfolio mgt marks: 75
NOTE: 5 QUESTION OF 15 Marks each.
All Questions are compulsory.
Q.1. Attempt any two of the following:Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 15 Marks
(a) Based on the below mentioned data, decide whether the portfolio has outperformed the market in term of Treynor, Sharpe & Jensen benchmark evaluation measures.
| Particulars | Â Â Â Â Â Â Portfolio | Â Â Â Â Market |
| Average Return | Â Â Â Â Â Â Â Â Â 7% | Â Â Â Â Â Â 10% |
| Beta | Â Â Â Â Â Â Â Â 0.4 | Â Â Â Â Â Â Â —- |
| Standard Deviation | Â Â Â Â Â Â Â Â Â 3% | Â Â Â Â Â Â Â 8% |
| Risk-free Rate | Â Â Â Â Â Â Â Â Â 6% | Â Â Â Â Â Â Â 6% |
(b) An investor buys 75 units of a fund at Rs 9.5 on 1/1/10. On 30/6/10, he receives dividend @10%. The ex-dividend NAV was Rs 10.25. On 31/12/10, the fund’s NAV was Rs 15.25. Calculate the return on investment.
(c) State and explain the structure of financial system.
Q.2. Attempt any two of the following:Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 15 Marks
(a) Arvind Enterprises purchases a Machinery for Rs.1,00,000 on 1st Jan 2002.The Expected profit from the Machinery are as follow:
| Year | 2002 | 2003 | 2004 | 2005 | 2006 |
| Profit | 7,000 | 9,000 | 19,000 | 23,0000 | 35,000 |
The Depreciation on Machinery is to be provided on WDV @10.00 pcpa.
At the end of 2006, the machinery is sold at the loss of Rs.7,500.Interest rate being 10%. Comment on decision:
(b) Find the present value of Rs.10,000 receivable after 6 years if the rate of interest is 10%? Will your answer differ if no. of years is 3 years?
(c) State and explain regulatory framework of SEBI of capital market?
Q.3. Attempt any two of the following:Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 15 Marks
(a) The rate of return on stock X and Y under different states of economy are given below:
| Particulars | Â Â BOOM | NORMAL | RECESSION |
| ROR Stock X(%) | 20 | 30 | 40 |
| ROR Stock Y(%) | 40 | 30 | 20 |
| Probability | 0.35 | 0.50 | 0.15 |
- i) Calculate the expected return and standard deviation on both the stocks?
- ii) If you could invest in either of Stock X and Y , but not in both , Which stock would you prefer?
(b) The capital of ABC ltd., consist of 9% Preference Shares of Rs.10 each, Rs.3,00,000, Equity Shares of Rs.10 each,Rs.8,00,000. The profit after tax is Rs.2,70,000. Equity Dividend is 20% and market price of Equity Shares is Rs.40.Your required to calculate following ratios and comment on them,               (a) Dividend Yield, (b) Preference and Equity Dividend Cover,(c) EPS and (d) P/E Ratio.
(c) What is technical Analysis? How is it different from the fundamental Analysis?
Q.4. Attempt any two of the following:Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 15 Marks
(a) Samruddhi ltd. paid Rs.2.50 as DPS on its Equity Shares for year ended 31st March 2010. Dividends are expected to grow @ 10 pcpa for an indefinite future. The current NPA’s is Rs.80.
1) What is the expected rate of return?
2) If the required rate of return is 12%, what will be the value of stock?
3) Is it worth investing in shares?
(b) A Bond pays an interest annually and sells for Rs.835. IF 6 years left to maturity and a par value of Rs.1,000,what is the coupon rate if YTM is 12%.
(c)Â Explain the following concept:
(a) Money market                                 (c) Portfolio diversification
(b) Expected Returns                           (d) Call option
Q.5. You are a portfolio management Consultant. A middle – class investor with investible funds of 15 Lakh approaches you. He wants to the following.
(a) What are the investment avenues available to him which will give stable returns with minimum risk?
(b) What are various types of risks? Please advice him.         15 Marks
Prof Jinall.Lathia
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