Security Analysis & Portfolio Management — DU Bachelor of Management Studies Previous Year Question Papers

Portfolio Management Economics) 2022 (LOCE) 1. (a) Investment is all about making your money work for you.' Explain. Also, explain the various avenues of in vesting (b) There are various attributes that one should 7% Govt. Securities Rs 8,00,000 consider while evaluating the soundness of an 9% Debentures (unlisted) R$ 5,00,000 investment.' Elaborate. 10% Debentures (listed) Rs 5,00,000 (c) Explain Candlestick Chart used in technical analysis. 98,00,000 2. (a) Consider the following two bonds: During the year, dividends of Rs 12,00,000 were Bond A Bond B received on equity shares. Interest on all types of Face Value deht securities was received as and when due. At the Maturity 10 years 1D years end of the year, the equity shares and 10% debentures Coupon 4% 8% are quoted at 175% and 90% respectively. Find out the NAV per unit given that operating expense paid solution, state and explain the relationship between (8) (b) What is ETF? How is it different from conventional (b) Discuss the primary propositions of the expectations mutual funds? (7) theory and liquidity preference theory. (7) 3. (a) A mutual fund made an issue of 10,00,000 units of 4. (a) A company carned Rs 6 per share and paid Rs Rs 10 each on Jan 1, 2021. No entry load was 3.48 per share as dividend in the previous year. charged. It made the following investments: What would be the price of the share today if 50,000 Equity shares (D growth in dividends is zero and of Rs 100 each @Rs160 RS 80,00,000 (i) growth in dividends are expected to grow at a (b) A company is expected to pay a dividend of Rs rate of 8.% indefinitely. 2 with an expected growth rate of 6% p.a. The The capitalization rate is 18%. risk-free rate is 4% and the return on a market (8) index is expected as 14%. Presently the company has a beta of 1,2 but it is expected to increase to (b) What is the difference between fundamental 1.5 due to some changes in Govt. policies. Find analysis and technical analysis? Which is superior out the present as well as the new value of shares out of the two? (7) as per CAPM model. Is the change in managerial 5. (a) Calculate the portfolio return and risk if an investor policies beneficial for an existing investor. (7) (i) 50% in A and 50% in B 6. (a) Following are the estimates of the present values of the future cash flows after taxes associated with the investment proposal, concerned with the (il) 20% in A and 80% in B expansion. The investor intends to use a decision tree approach to get a clear picture of the possible (illi) 80% in A and 20% in B outcomes of this investment. The investment for expansion is expected to cost Rs 3.00,000. The Security A respective PVs of future Cash Flows after tax (CFAT) and probabilities are as follows: Expected Return 15% Standard Deviation 5.3% With Expansion Rs] Without Expansion (Rs) Probabilities Coefficient of correlation between A and B is -0.94. 9.00,000 3,50,000 0.4