Here are the returns on two stocks:

	Digital Cheese	Executive Fruit
January	+18	+8
February	-4	+1
March	+6	+5
April	+8	+16
may	-5	+2
June	+4	+6
July	-3	-4
August	-9	-3

 

A-1) Calculate the variance and standard deviation of each stock

A-2) Which stock is riskier if held on its own?

B.) Now calculate the returns in each month of a portfolio that invests an equal amount each month in the two stocks

C.) Is the variance more or less than halfway between the variance of the two individual stocks?

Answer rating: 100% (QA)

To calculate the variation and standard deviation of stock we need to find the mean return for each stock then substract the mean of each return squar... View the full answer