Zee Entertainment Enterprises Limited (ZEEL.

NS)
Per share values RS
Initial Investment (P0) 100
Dividend (Div) 1.2
Current market price (P1) 109

Dividend Gain 1.20%

Capital Gain 9.00%
Total Gain 10.20%
Time Return % (Ri) Probability (Pi)
1 10 0.1
2 11 0.2
3 10.5 0.4
4 12 0.2
5 11 0.1
SUM 54.5 Expected Rate of Return %

RISK/SD
Expected Rate of Return Ri-E(R)
(Pi*Ri) OR E(R)
1 9
2.2 8.8
4.2 6.3
2.4 9.6
1.1 9.9
10.9

8.22781866596487
(Ri-E(R))^2 Pi*(Ri-E(R))^2
81 8.1
77.44 15.488
39.69 15.876
92.16 18.432
98.01 9.801
Variance 67.697
 Weigth: 50:50
Probablity Stock A Return (Ri) Stock B Return (Ri) Expected Return A - E(R)
1 0.2 15 -5 3
2 0.2 -5 15 -1
3 0.2 5 25 1
4 0.2 35 5 7
5 0.2 25 35 5

Expected Return % 15
Portfolio Expected Return 15
SD of Stock A
SD of Stock B
SD of Portfolio

Weightage
Stock A 0.5
Stock B 0.5

Expected Return (A): 15%

Questions What is the expected return and risk if you invest only in stock A? Risk (A): 14.14
Expected Return (B): 15%
What is the expected return and risk if you invest only in stock B? Risk (B): 14.14
What is the expected return and risk if you invest in a portfolio Expected Return
consisting of stock A and B in equal proportion (Portfolio A + B (50/50):
15%
Risk (B): 9.486
 50:50 weightage of both stocks
Expected Return B - E(R) Expected Return A and B (Portfolio) -E(RP) Stock A Variance (Pi*(Ri-E(R))^2)
-1 5 0
3 5 80
5 15 20
1 20 80
7 30 20
75 200
15

14.142135623731
14.142135623731
9.48683298050514
Stock B Variance (Pi*(Ri-E(R))^2) Portfolio Variance (Pi*(Ri-E(RP)^2)
80 20
0 20
20 0
20 5
80 45
200 90
 Probablity Box Stock (Ri) Cox Stock (Ri) Expected Return: Box Stock
1 0.3 1000 1500 300
2 0.4 1100 1300 440
3 0.2 1200 900 240
4 0.1 1400 600 140
1120

as per the question: both stocks are at Rs 100, That means with the investment of RS 1000 we can buy 10 shares of each co.
BOX Stock
Total Imvestment on Box 1000
Share Price 100
Share count of Box 10
COX Stock
Total Imvestment on Cox 1000
Share Price 100
Share count of Box 10
Portfolio - Box + COX
Total Imvestment on Cox 1000
Share Price (Same price for both 100
Box Stock Weightage 0.5
Share count of Box 5
COX Stock Weightage 0.5
Share count of Box 5
 Expected Return: Cox Stock Box Stock (Ri)-Portfolio Cox Stock (Ri)-Portfolio
450 500 750
520 550 650
180 600 450
60 700 300
1210
SD/Risk

we can buy 10 shares of each co.

Expected Portfolio Return BOX Stock - Variance Pi*(Ri-E®)^2) COX Stock - Variance Pi*(Ri-E®)^2)
375 4320 25230
480 160 3240
210 1280 19220
100 7840 37210
1165 13600 84900
116.619037896906 291.376045686669
Portfolio Variance Pi*(((Box Ri + Cox Ri)-E(R) of Portfolio)^2)
2167.5
490
2645
2722.5
8025
89.5823643358446
Price Per Share 10

Price Probablity Expected Price

10 0.4 4
11 0.4 4.4
12 0.2 2.4
10.8