Question
Intro The following table shows realized rates of return for two stocks. A B C 1 Year Stock A Stock B 2 1 5% 15%
Intro
The following table shows realized rates of return for two stocks.
A | B | C | |
1 | Year | Stock A | Stock B |
2 | 1 | 5% | 15% |
3 | 2 | -22% | -14% |
4 | 3 | -6% | -9% |
5 | 4 | 5% | 28% |
6 | 5 | 14% | 8% |
7 | 6 | 20% | 4% |
Part 1
What is the arithmetic average return for stock B?
Part 2
What is the variance for stock B?
Part 3
What is the covariance of returns?
Part 4
What is the mean return of a portfolio with 20% invested in stock A and the remainder in stock B (assuming annual rebalancing)?
Part 5
What is the standard deviation of a portfolio with 20% invested in stock A and the remainder in stock B (assuming annual rebalancing)?
Part 6
What is the mean return of a portfolio with 60% invested in stock A and the remainder in stock B (assuming annual rebalancing)?
Part 7
What is the standard deviation of a portfolio with 60% invested in stock A and the remainder in stock B (assuming annual rebalancing)?
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