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Using the data from Table 12.30, what is the volatility of an equally weighted portfolio of McDonalds and Starbucks stock? Data Table TABLE 12.3 Estimated
Using the data from Table 12.30, what is the volatility of an equally weighted portfolio of McDonalds and Starbucks stock? Data Table TABLE 12.3 Estimated Annual Volatilities and Correlations for Selected Stocks (Based on Monthly Returns, January 2006-December 2015) Cisco 28% Boeing 26% 0.52 0.52 0.10 Standard Microsoft Starbucks Netflix Coca-Cola McDonald's Deviation 25% 29% 61% 16% 14% Microsoft 1 0.35 0.18 0.40 0.43 Starbucks 0.35 1 0.19 0.23 0.17 Netflix 0.18 0.19 1 0.00 0.13 Coca-Cola 0.40 0.23 0.00 1 0.59 McDonald's 0.43 0.17 0.13 0.59 1 Cisco 0.52 0.52 0.10 0.27 0.28 Boeing 0.28 0.48 0.10 0.34 0.37 Source: Authors' calculations based on data from The Center for Research in Security Prices. 0.28 0.48 0.10 0.34 0.37 0.27 0.28 1 0.46 0.46 1
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