PLEASE PROVIDE EXCEL EXPLANATION AND FORMULAS AS I AM NOT GETTING ERRORS.

1.Go to Yahoo! nance, and download monthly return series for the ve years (Jan 2014-Jan 2019) for the following three stocks: Oracle (ORCL), General Mills (GIS), and Conoco Phillips (COP). For each stock, calculate the mean monthly return for each stock, standard deviation, and list the highest two and lowest two month returns.

2.For each pair of stocks (i.e., ORCL-GIS, GIS-COP, and ORCL-COP), calculate the covariance (Excel function COVAR()) in returns over the sample period. Also, report the correlation coecient (Excel function CORREL()) for each pair of stocks. Which two stocks have the highest correlation? Which two are least correlated?

6.Call portfolio A the 50%-50% portfolio between COP and GIS, and call portfolio B the 50%-50% portfolio between ORCL and GIS. Conduct the same exercise (0-100, 10-90, 20-80, etc.) between portfolios A and B as you did in part (3) using individual stocks. Here, the 0-100 portfolio will be portfolio A, the 10-90 will be 10% portfolio A and 90% portfolio B, etc. For each of these mixes between portfolios A and B, calculate the expected return and standard deviation. HINT: You'll want to start by calculating the monthly returns of portfolios A and B, which will give you two time-series. Think about the returns of these portfolios just like you would think about the returns of individual stocks. For example, you have an estimate of the mean return of portfolio A, and an estimate of the volatility of portfolio A. Same for B. You can also calculate a sample covariance between the returns of portfolio A and portfolio B. You will use these quantities to trace out the curve required for this question.

EXTRA CREDIT - THIS WILL BE CHALLENGING. Using solver in EXCEL, identify the set of ecient portfolios for all possible combinations of the three stocks given above. You'll want to type in the formula for portfolio standard deviation, as a function of possible weights on each of the three stocks. Then, for a given expected return, you'll want EXCEL to search (using SOLVER) for the set of weights that minimizes the portfolio standard deviation. The resulting pair of (expected return, standard deviation) is a point on the ecient frontier. Go in small increments of expected return, and trace out the new ecient frontier. How does the new ecient frontier compare to the one you drew in part (6)?