Answered step by step
Verified Expert Solution
Question
1 Approved Answer
what formula do I use to find out the excess market returns taking into consideration that I know the DowJones index prices, implied volatility index,
what formula do I use to find out the excess market returns taking into consideration that I know the DowJones index prices, implied volatility index, exchange rate and oil prices?
c) Compute the descriptive statistics of the excess market returns series. The Excel spreadsheet "DOW_Dataset.xlsx" contains the data for the task. The dataset contains the time series of (i) the Dow Jones Industrial Average index prices (DOW), (ii) the S\&P 500 implied volatility index (VIX), (iii) the USD-GBP exchange rate as U.S. Dollars to one U.K. Pound Sterling (USDGBP), and (iv) the crude oil prices from the West Texas Intermediate (OIL). All the time series are downloaded from FRED. The dataset time period is from 02 January 2013 to 29 July 2022, at a daily frequencyStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started