Problem 10

Intro

The following table shows realized rates of return for two stocks.

	A	B	C
1	Year	Stock A	Stock B
2	1	-10%	15%
3	2	-22%	-14%
4	3	-6%	-5%
5	4	5%	28%
6	5	14%	8%
7	6	14%	3%

Attempt 1/10 for 10 pts.

Part 1

What is the arithmetic average return for stock B?

Attempt 1/10 for 10 pts.

Part 2

What is the variance for stock B?

Attempt 1/10 for 10 pts.

Part 3

What is the covariance of returns?

Attempt 1/10 for 10 pts.

Part 4

What is the correlation coefficient?