DPL Therapeutics just conducted its IPO $($initial public offering$),$ and there is much excitement$$both inside the company and in the marketplace$$surrounding this young company. One of the products it$$s developing just started Phase I clinical trials, which tests for the safety of the medicine on people. The product is a new migraine medication that intends to treat patients who have not responded well to conventional migraine medication $($e$.$g$.,$ triptans$).$ The CEO and the company$$s investors are a bit nervous about the company$$s success during the trials, and as a result, the stock price has been experiencing some volatility. As part of the CFO$$s finance team, you$$ve been charged with the following tasks:

$1.$ What is the average monthly return for the stock since its IPO? The annualized rate of return?

$2.$ What is the annualized standard deviation since the IPO?

$3.$ What is the correlation of the stock price with the stock market?

$4.$ What is the Sharpe ratio for the stock?

$5.$ Develop a scatterplot of DPL$$s stock price and the market portfolio $($place DPL on the y$-$axis$).$ Do you see a pattern?

$6.$ What is the beta of DPL$$s stock price? What does this suggest in terms of risk?

$7.$ f you owned the stock, would you expect a higher return than the stock market? Why or why not?

$8.$ Is the S&P the appropriate benchmark for this stock? If not, which do you recommend?