| Option 1 |
| Savings account |
| Return r | 5% |
| Period of investment n-per | 25 |
| Amount A | $ 100,000.00 |
| Future value | 338635.494089939 | A*(1+r)^n |
| Risk free rate Rf | 2% | http://people.stern.nyu.edu/adamodar/podcasts/cfspr15/cfsession6.pdf |
| Average market return Rm | 10% |
| Beta of chipotle mexican grill | 0.29 | http://finance.yahoo.com/quote/CMG |
| Expected Return | 4.32% | Rf + beta*(Rm-Rf) |
| Period of investment n-per | 25 |
| Amount A | $ 100,000.00 |
| Future value | 287865.394520996 | A*(1+r)^n |
| Savings account will have higher expected future than investment in CMG stock also savings account will not have any correlation with investment in d&P 500 and bonds thus thiss will help in achieving diversification thus investment in saving is better option |
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9384585.xlsx
