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Please show all your work - formulas, inputs and results. 1. You have observed the following returns over time: (a) Calculate the average returns for

Please show all your work - formulas, inputs and results.

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1. You have observed the following returns over time: (a) Calculate the average returns for stocks X and Y. (b) Calculate the variances and standard deviations for stocks X and Y. (c) Calculate the covariance between stocks X and Y. What is the correlation coefficient? (d) Assuming you invest 50% of your wealth in stock X and 50% in stock Y, what is the return on the new portfolio you formed? (e) Calculate the standard deviation of the portfolio

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