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Stock M and Stock N have had the following returns for the past three years: 12 percent, -10 percent, and 32 percent; and 15 percent,

Stock M and Stock N have had the following returns for the past three years: 12 percent, -10 percent, and 32 percent; and 15 percent, 6 percent, and 24 percent, respectively. Calculate the covariance between the two securities. (Ignore the correction for the loss of a degree of freedom set out in the text.)

Answer. 126

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