Here are the returns on two stocks. Digital Cheese Executive Fruit January +17 +6 February 4 +1 March +6 +5 April +8 +15 May 5
Here are the returns on two stocks.
Digital Cheese Executive Fruit January +17 +6
February 4 +1
March +6 +5
April +8 +15
May 5 +2
June +4 +4
July 3 4
August 9 3
Required:
a-1.Calculate the variance and standard deviation of each stock. (Digital Cheese Return and Executive Fruit Return)
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. (Jan-Aug)
c.Is the variance more or less than halfway between the variance of the two individual stocks?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Authors: Michael J. Sandretto
1st edition
538476796, 978-0538476799
