Question
6. Using the data in the following table, estimate: (a) The average return and volatility for each stock (b) The covariance between the stocks (c)
6. Using the data in the following table, estimate: (a) The average return and volatility for each stock (b) The covariance between the stocks (c) The correlation between these two stocks (d) Calculate the volatility of a portfolio that is 70% invested in stock A and 30% invested in stock B.
| A | B | |
| 2004 | -10% | 21% |
| 2005 | 20% | 7% |
| 2006 | 5% | 30% |
| 2007 | -5% | -3% |
| 2008 | 2% | -8% |
| 2009 | 9% | 25% |
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The Handbook Of Investing In Todays Financial Markets
Authors: Alessandro De Cristofaro
1st Edition
1070350931, 978-1070350936
