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Question: ms rose wants to invest rs 10 mln in a...

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Ms Rose wants to invest Rs 10 Mln in a fund indexed with S & P 500. The continuous return and the continuous standard deviation of the S&P index has been 12% and 17% respectively for the last 60 years.

a. Calculate the probability of doubling the investment in 9 years by Ms Rose

b.Estimate the probability of incurring losses from the portfolio within 9 years.

You may apply following model adhering to standard deviation.Please state all the assumptions you may have with the answer.

Z=(In(FV/B)-Rc N) /\sigma s \sqrt N

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