Given the following information:

 

PART ONE

1. Average Returns, Variance and Standard Deviation of the stocks.
   • Analyze these values for each firm
   • Compare these values between firms
2. Beta
   • Compare and contrast these Beta estimates
3. What is the difference between the two types of measures?
4. How do these ideas contribute to the valuation of the firm?

PART TWO

1. Give an answer as to whether or not you should buy these stocks and explain why. Please be detailed and refer back to previous information.

Beta CAPM Return Variance Amazon (AMZN) 1.143233 0.064856 0.006529 Standard Deviation 0.080802 Netflix (NFLX) 0.759231 0.051838 0.009903 0.099515