Question
You observe returns on stocks A and B on three dates: Returns Date Stock A Stock B 1 3% 4% 2 4% 6% 3 1%
- You observe returns on stocks A and B on three dates:
| Returns | ||
| Date | Stock A | Stock B |
| 1 | 3% | 4% |
| 2 | 4% | 6% |
| 3 | 1% | 3% |
What is the standard deviation of the individual stock returns? What is the covariance? What is the correlation?
(You may use Excel commands to answer these questions and write down your answers instead of calculating the answers by hand.)
You form a portfolio that is 30% invested in stock A and 70% invested in stock B. What are the portfolio returns on dates 1, 2, and 3? What is the mean return and the return standard deviation of your portfolio?
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Political Economy Of Money And Finance 1999
Authors: Makoto Itoh, Costas Lapavitsas, Makoto Itō
1st Edition
033366521X, 9780333665213
