Formulas

Question 1

Alpha

Answer 1

Alpha = portfolio return - (Rf + Beta (Rm - Rf))

Question 2

CAPM

Answer 2

(( Rf + Beta (Rm - Rf))

Question 3

Sharpe ratio

Answer 3

Portfolio return - risk free rate/standard deviation

Question 4

Information ratio

Answer 4

Portfolio return - Benchmark return/Tracking error

Question 5

MWR

Answer 5

D+V1-V0-C/V0 + (c x n/12)

Question 6

TWR

Answer 6

V1/ V0 x V2 / V1 + C

Question 7

Premium/Discount on convertible shares

Answer 7

Conversion ratio x Price of convertible shs/Price of ord shs -1

Question 8

Warrant conversion premium/discount

Answer 8

Exercise price + Warrant price/ ord share price -1

Question 9

Call warrant payout

Answer 9

Price of underlying - Strike price/ Parity

Question 10

Warrants gearing ratio

Answer 10

Share price/warrant price

Question 11

Modified duration

Answer 11

Macauley duration/ (1 + GRY)

Question 12

NAV Premium/Discount for an IT

Answer 12

Share price/NAV -1

Question 13

Operating margin

Answer 13

Operating profit/total sales x100

Question 14

P/E ratio

Answer 14

Share price/ EPS

Question 15

Dividend cover

Answer 15

EPS/Dividend per share

Question 16

Current ratio

Answer 16

Current assets/current liabilities

Question 17

Quick ratio

Answer 17

Current assets - stock/ current liabilities

Question 18

What is the GRY formula?

Answer 18

Flat yield + ((par - price) / years to redemption/price)) x100