Question
Using the data in the following table, Year 2010 2011 2012 2013 2014 2015 Stock A 3% 9% 9% 7% 4% 15% Stock B 28%
Using the data in the following table,
Year | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | ||||||
Stock A | 3% | 9% | 9% | 7% | 4% | 15% | ||||||
Stock B | 28% | 33% | 20% | 1% | 8% | 24% |
estimate the:
a. Average return and volatility for each stock.
b. Covariance between the stocks.
c. Correlation between these two stocks.
Question content area bottom
Part 1
a. Estimate the average return and volatility for each stock.
The average return of stock A is
4.54.5%.
(Round to two decimal places.)
Part 2
The average return of stock B is
1616%.
(Round to two decimal places.)
Part 3
The standard deviation of stock A is
0.082400.08240.
(Round to five decimal places.)
Part 4
The standard deviation of stock B is
0.166010
(Round to five decimal places.)
Part 5
b. Estimate the covariance between the stocks.
The covariance is :
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