Assignment 1: Please search for the end-ofmonth prices {January 2015 January 2020) for 3 traded stocks from different industries (choice is on you) but from the same market index (Dow Jones), as well as the corresponding values of the stock index. a) 13) Cl d) Calculate and comment on the monthly (logarithmic) returns of the three stocks, as well as those of the stock index Calculate and comment the volatilities (standard deviations of returns) for the three stocks, as well as that of the Dow Jones Calculate and comment on the correlation coefficients for each pair of the stocks. Based on the correlation coefficient, suggest which pair would be most suitable for creating a diversified portfolio, if that portfolio was to include just two stocks Calculate the monthly volatilities for the portfolios consisting of equally-weighted pairs of the stocks, as well as for the portfolio consisting of all three equally weighted stocks, and discuss the results Using linear regression, calculate the betas for each of the stocks. Which of them is aggressive, defensive, and neutral? Construct a neutralized portfolio (creating three different portfolios) Do a forecast of your chosen stock prices for the next 12 months (February 2020 February 2021) using the simple regression model and calculate the %Error rate of your created model