Ml4t Study Guide Exam And Actual Answers.

Cumulative Return - Answer The cumulative return is the total change in the investment price over a set time—an aggregate return, not an annualized one. (price[t]/price[0]) - 1 normalization from when stock was purchased Daily return - Answer (Today's stock price[t]/yesterday's stock price[t - 1]) - 1 sharpe ratio formula - Answer s = sqrt(252) * mean(daily_ret - daily_riskFree) / std(daily_ret - daily_riskFree) limit order - Answer A limit order is an order to buy or sell a stock at a specific price or better. A buy limit order can only be executed at the limit price or lower, and a sell limit order can only be executed at the limit price or higher. A limit order is not guaranteed to execute. intrinsic value - Answer present_value = future_value/1+ intrest_rate^i t=how far in the future do examples! in lecture are examples Book value - Answer total assets ignoring intangible assets and minus liabilities market value - Answer Market value/ market capitalization shares outstanding * price = market cap Bolliger bands - Answer add a band two standard deviations above and two standard deviations bellow types of funds - Answer ETF, Mutual Fund, Hedge Fund