Question
Returns, Risk, & Correlations Download the spreadsheets containing the daily stock prices for General Electric , Microsoft , and Wal-Mart and the daily token prices
Returns, Risk, & Correlations
Download the spreadsheets containing the daily stock prices for General Electric, Microsoft, and Wal-Mart and the daily token prices for Bitcoin. Calculate daily returns over the period MM/DD/2016 to MM/DD/2017, where MM/DD corresponds to the month and day of your birthday. (If your birthday occurs on a weekend, be sure to include at least one daily price before and after your birthday.) Merge the returns for these four assets into a single Excel workbook with the returns for each one in a separate column, properly aligned by date.
- Using the Excel functions for Average and Standard Deviation, calculate the average and standard deviation of returns for each asset.
- Using the Correlation function, construct the correlation matrix for the securities using the daily returns for the entire period.
- Which pair of assets has the highest correlation coefficient? The lowest?
- If you had to choose two assets for your portfolio, which pair would give you the greatest benefit with regard to diversification? Explain.
(PLEASE INCLUDE LINK FOR EXCEL SPREADSHEET)
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