The following are monthly percentage price changes for four market indexes.

$\backslash$table$[[$Month$,$DJIA,S&P $500,$Russell $2000,$Nikkei$],[1,0\mathrm{.}02,0\mathrm{.}03,0\mathrm{.}03,0\mathrm{.}03],[2,0\mathrm{.}09,0\mathrm{.}08,0\mathrm{.}13,-0\mathrm{.}02],[3,-0\mathrm{.}01,-0\mathrm{.}02,-0\mathrm{.}03,0\mathrm{.}06],[4,0\mathrm{.}01,0\mathrm{.}03,0\mathrm{.}03,0\mathrm{.}03],[5,0\mathrm{.}06,0\mathrm{.}03,0\mathrm{.}15,0\mathrm{.}03],[6,-0\mathrm{.}04,-0\mathrm{.}04,-0\mathrm{.}07,0\mathrm{.}04]]$

Compute the following.

a$.$ Average monthly rate of return for each index. Round your answers to five decimal places.

DIIA

SBD $500t$

Ruseell $2000$ :

Nildkel:

b$.$ Standard deviation for each index. Do not round intermediate calculations. Round your answers to four decimal places.

Drai

SEP $500$

Russell $2000$

Niketi

Covariance $($DJA$,$ S$8$P $500)!$

Covariance $($SBD $500,$ Russell $2000$

Covariance $($S$8$P $500,$ Nildkei$)!$

Covariance $($Russell $2000,$ Nikkel$)$ Correlation $($DIIA$,$ SBP $500)$

Corralation $($S$8$P $500,$ Russell $2000)$

Comelation $($S$8$P $500,$ Nikkel$)?$

Correlation $($Russell $2000,$ Nikkei$)$:

Standard deviation $($S$8$P $500$ and Russell $3000)$

Expected retum $($S$D $500$ and Nikkai$)$y

Standard deviation $($SUP $500$ and Nikkel$)$

Since $589500$ and Nikkei have a strong Select $V$ correlation, meaningful reduction in risk $-$Select$-$ if they are combined.