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10. Using Excel, take the information from 3 stocks at your choice. Take this information monthly for 10 years. (a) Compute the returns on every
10. Using Excel, take the information from 3 stocks at your choice. Take this information monthly for 10 years. (a) Compute the returns on every stock. In doing do, use the following formula: Pt,i Pt-1,i ri = Where Pti is the price of stock i at time (b) Compute the average return for every stock (c) Compute the variance and the standard deviation for every stock. (d) Compute the covariance of all the stocks with each other (e) Set a target expected return for your portfolio based on the averages you com- puted before and find the optimal weights in order to get that expected return by minimizing the risk
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