The following table presents key data on excess returns of S&P500 Index and Facebook share price. Linear regression on the dependency of Google on S&P500 has been run.

1. Calculate Sharpe ratios for S&P500 and Facebook.

2. What percentage of Facebook excess return volatility is explained by S&P500 volatility?

3. Calculate the weights of S&P500 and Facebook in the optimal active portfolio using Traynor Black Model

Average excess return Variance of excess returns Correlation coefficient S&P500 FACEBOOK 0,85% 1,89% 0,18% 0,60% 0,66 Regression Statistics Multiple R R Square Adjusted R Square Standard Error Observations 0,662383 0,438751 0,429075 0,058376 60 Standard Coefficients Error t Stat P-value 0,008682 0,007687 1,129459 0,263354 1,193025 0,177176 6,733571 8,2E-09 Intercept X: S&P500 Excess Return Average excess return Variance of excess returns Correlation coefficient S&P500 FACEBOOK 0,85% 1,89% 0,18% 0,60% 0,66 Regression Statistics Multiple R R Square Adjusted R Square Standard Error Observations 0,662383 0,438751 0,429075 0,058376 60 Standard Coefficients Error t Stat P-value 0,008682 0,007687 1,129459 0,263354 1,193025 0,177176 6,733571 8,2E-09 Intercept X: S&P500 Excess Return