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Suppose there are two stocks, A and B. Also suppose there are two possible outcomes. Outcome 1 happens with 40% probability and outcome 2 happens
Suppose there are two stocks, A and B. Also suppose there are two possible outcomes. Outcome 1 happens with 40% probability and outcome 2 happens with 60% probability. In outcome 1, stock A has 11% return and stock B has 5% return. In outcome 2, stock A has -2% return and stock B has 9% return. What is the correlation of their returns?
-60.56935191 | ||
-1 | ||
-0.001248 | ||
-0.228735683 |
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