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Complete the questions using R Script. This is all the information given Using the historical data provided, find the mean and standard deviation of the
Complete the questions using R Script. This is all the information given
- Using the historical data provided, find the mean and standard deviation of the returns of the risky asset
- Create a function that calculates the best possible asset allocation between the risky and riskless assets
- Using this function, find the best possible asset allocation between the risky asset from Step 1 and a riskless asset with a return of 3.5% for an investor with a coefficient of risk aversion of 3.8.
| year | risky asset return |
| 1 | 0.0441677 |
| 2 | -0.1226099 |
| 3 | 0.04845585 |
| 4 | 0.13300576 |
| 5 | 0.07610883 |
| 6 | -0.1006195 |
| 7 | 0.15361525 |
| 8 | 0.11240244 |
| 9 | 0.06454932 |
| 10 | 0.1013993 |
| 11 | 0.1048939 |
| 12 | -0.0454068 |
| 13 | 0.06817743 |
| 14 | 0.17458466 |
| 15 | 0.10985191 |
| 16 | -0.0542494 |
| 17 | 0.09745474 |
| 18 | 0.11899063 |
| 19 | -0.0124672 |
| 20 | 0.13086449 |
| 21 | -0.0596302 |
| 22 | 0.02645831 |
| 23 | 0.07517141 |
| 24 | -0.0051806 |
| 25 | 0.15126484 |
| 26 | -0.0965493 |
| 27 | 0.22703194 |
| 28 | 0.16026128 |
| 29 | 0.06934095 |
| 30 | 0.00392107 |
| 31 | -0.0110056 |
| 32 | 0.1703484 |
| 33 | 0.07916124 |
| 34 | 0.11850884 |
| 35 | 0.08660435 |
| 36 | -0.0051788 |
| 37 | 0.1397996 |
| 38 | 0.15836418 |
| 39 | -0.0351296 |
| 40 | 0.18013566 |
| 41 | 0.24812023 |
| 42 | 0.04800945 |
| 43 | 0.17955221 |
| 44 | 0.08722588 |
| 45 | 0.08693944 |
| 46 | 0.05114366 |
| 47 | 0.14463659 |
| 48 | -0.0043474 |
| 49 | 0.02722667 |
| 50 | 0.0749192 |
| 51 | 0.07879394 |
| 52 | -0.004076 |
| 53 | -0.0025389 |
| 54 | 0.25534582 |
| 55 | 0.03749105 |
| 56 | 0.16274938 |
| 57 | -0.0288327 |
| 58 | 0.11954991 |
| 59 | 0.03668721 |
| 60 | 0.18735517 |
| 61 | 0.03911828 |
| 62 | 0.1135662 |
| 63 | 0.20747982 |
| 64 | 0.01086152 |
| 65 | -0.0039231 |
| 66 | -0.0778498 |
| 67 | -0.0479318 |
| 68 | -0.0303942 |
| 69 | 0.0572853 |
| 70 | 0.02323396 |
| 71 | -0.0497979 |
| 72 | 0.00192938 |
| 73 | -0.0078804 |
| 74 | 0.13220173 |
| 75 | 0.02292378 |
| 76 | -0.0230302 |
| 77 | 0.16758643 |
| 78 | 0.13503774 |
| 79 | -0.0565015 |
| 80 | 0.15430047 |
| 81 | -0.1594624 |
| 82 | 0.04681331 |
| 83 | 0.1466907 |
| 84 | 0.08209898 |
| 85 | 0.05260889 |
| 86 | 0.04322869 |
| 87 | -0.0128389 |
| 88 | 0.0346096 |
| 89 | 0.05376601 |
| 90 | 0.13616144 |
| 91 | -0.1040444 |
| 92 | 0.14694161 |
| 93 | -0.0416876 |
| 94 | 0.11892658 |
| 95 | 0.10375179 |
| 96 | -0.0137491 |
| 97 | 0.10064254 |
| 98 | 0.08385408 |
| 99 | -0.0942224 |
| 100 | 0.0341587 |
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Practicing Statistics Guided Investigations For The Second Course
Authors: Shonda Kuiper, Jeff Sklar
1st Edition
9780321586018
