Question
Here are the returns on two stocks. Digital Cheese Executive Fruit January +14 +7 February 3 +1 March +5 +4 April +7 +13 May 4
Here are the returns on two stocks.
Digital Cheese | Executive Fruit | |||||||
January | +14 | +7 | ||||||
February | 3 | +1 | ||||||
March | +5 | +4 | ||||||
April | +7 | +13 | ||||||
May | 4 | +2 | ||||||
June | +3 | +5 | ||||||
July | 2 | 3 | ||||||
August | 8 | 2 | ||||||
Required:
a-1. Calculate the variance and standard deviation of each stock.
a-2. Which stock is riskier if held on its own?
b. Now calculate the returns in each month of a portfolio that invests an equal amount each month in the two stocks.
c. Is the variance more or less than halfway between the variance of the two individual stocks?
Calculate the variance and standard deviation of each stock. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
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- Req A1 Calculate the variance and standard deviation of each stock. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
Digital Cheese Retum Executive Fruit Return Variance 0.51 % 23.23 % Standard deviation 7.11 4.82 - Req A2 Which stock is riskier if held on its own? Options: Digital cheese or Executive Fruit
- Req B: Now calculate the returns in each month of a portfolio that invests an equal amount each month in the two stocks. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.)
- Req C:
Is the variance more or less than halfway between the variance of the two individual stocks?
Options or MORE or LESSIs the variance more or less than halfway between the variance of the two individual stocks?
The above has the amounts that I came up with thus far. I am not sure if they are right so please provide feedback and formulas to arrive to the answers so i can review my progress and where I went wrong.
Thanking you in advance,
Month Portfolio Return January February March April May June July August
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