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Using the data below, what is the covariance between the stocks of Alaska Air and General Mills? Historical Annual Volatilities and Correlations for Selected Stocks
Using the data below, what is the covariance between the stocks of Alaska Air and General Mills?
Historical Annual Volatilities and Correlations for Selected Stocks (based on monthly returns, 1996-2017) \begin{tabular}{lccccccc} \hline & Microsoft & HP & AlaskaAir & SouthwestAirlines & FordMotor & KelloggMills \\ \hline Volatility(StandardDeviation)Correlationwith & 0.32 & 0.36 & 0.36 & 0.31 & 0.47 & 0.19 & 0.17 \\ Microsoft & & & & & & & \\ HP & 1.00 & 0.40 & 0.18 & 0.22 & 0.27 & 0.04 & 0.10 \\ Alaska Air & 0.40 & 1.00 & 0.27 & 0.34 & 0.27 & 0.10 & 0.06 \\ Southwest Airlines & 0.18 & 0.27 & 1.00 & 0.40 & 0.15 & 0.15 & 0.20 \\ Ford Motor & 0.22 & 0.34 & 0.40 & 1.00 & 0.30 & 0.15 & 0.21 \\ Kellogg & 0.27 & 0.27 & 0.15 & 0.30 & 1.00 & 0.17 & 0.08 \\ General Mills & 0.04 & 0.10 & 0.15 & 0.15 & 0.17 & 1.00 & 0.55 \\ \hline \end{tabular}Step by Step Solution
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