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Following are the monthly returns for October 2007 to March 2013 of three international stock indices: All Ordinaries of Australia, Nikkei 225 of Japan, and

Following are the monthly returns for October 2007 to March 2013 of three international stock indices: All Ordinaries of Australia, Nikkei 225 of Japan, and FTSE 100 of England.

Date All Ordinaries NIKKEI 225 FTSE
Mar-13 2 2.74% 7.25% 0.80%
Feb-13 4.48 3.78 1.34
Jan-13 5.07 7.15 6.43
Dec-12 3.24 10.05 0.53
Nov-12 0.38 5.80 1.45
Oct-12 2.93 0.66 0.71
Sep-12 1.55 0.34 0.54
Aug-12 1.16 1.67 1.35
Jul-12 3.72 3.46 1.15
Jun-12 0.04 5.43 4.70
May-12 7.47 10.27 7.27
Apr-12 1.07 5.58 0.53
Mar-12 0.73 3.71 1.75
Feb-12 1.44 10.46 3.34
Jan-12 5.22 4.11 1.96
Dec-11 1.76 0.25 1.22
Nov-11 4.03 6.16 0.70
Oct-11 7.13 3.31 8.11
Sep-11 6.86 2.85 4.93
Aug-11 2.90 8.93 7.23
Jul-11 3.42 0.17 2.19
Jun-11 2.70 1.26 0.74
May-11 2.25 1.58 1.32
Apr-11 0.60 0.97 2.73
Mar-11 0.10 8.18 1.42
Feb-11 1.52 3.77 2.24
Jan-11 0.06 0.09 0.63
Dec-10 3.65 2.94 6.72
Nov-10 1.20 7.98 2.59
Oct-10 2.08 1.78 2.28
Sep-10 4.46 6.18 6.19
Aug-10 1.52 7.48 0.62
Jul-10 4.22 1.65 6.94
Jun-10 2.89 3.95 5.23
May-10 7.87 11.65 6.57
Apr-10 1.21 0.29 2.22
Mar-10 5.20 9.52 6.07
Feb-10 1.18 0.71 3.20
Jan-10 5.85 3.30 4.15
Dec-09 3.55 12.85 4.28
Nov-09 1.48 6.87 2.90
Oct-09 1.95 0.97 1.74
Sep-09 5.69 3.42 4.58
Aug-09 5.52 1.31 6.52
Jul-09 7.64 4.00 8.45
Jun-09 3.53 4.58 3.82
May-09 1.83 7.86 4.10
Apr-09 6.01 8.86 8.09
Mar-09 7.14 7.15 2.51
Feb-09 5.21 5.32 7.70
Jan-09 4.95 9.77 6.42
Dec-08 0.36 4.08 3.41
Nov-08 7.78 0.75 2.04
Oct-08 14.00 23.83 10.71
Sep-08 11.20 13.87 13.02
Aug-08 3.22 2.27 4.15
Jul-08 5.26 0.78 3.80
Jun-08 7.64 5.98 7.06
May-08 2.07 3.53 0.56
Apr-08 4.57 10.57 6.76
Mar-08 4.67 7.92 3.10
Feb-08 0.39 0.08 0.08
Jan-08 11.28 11.21 8.94
Dec-07 2.62 2.38 0.38
Nov-07 2.74 6.31 4.30
Oct-07 3.01 0.29 3.94

a. Compute and compare each indexs monthly average return and standard deviation.

b. Compute the correlation between (1) All Ordinaries and Nikkei 225, (2) All Ordinaries and FTSE 100, and (3) Nikkei 225 and FTSE 100, and compare them.

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