The following are the monthly rates of return for Madison Corp. and for Sophie Electric during a

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The following are the monthly rates of return for Madison Corp. and for Sophie Electric during a six-month period.

a. Compute the average monthly rate of return for each stock.

b. Compute the standard deviations for each stock.

c. Compute the covariance between the rates of return.

d. Compute the correlation between the rates of return.

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Investment Analysis and Portfolio Management

ISBN: 978-0538482387

10th Edition

Authors: Frank K. Reilly, Keith C. Brown

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Question Posted: Apr 13, 2012 07:45 AM

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The following are the monthly rates of return for Madison Corp. and for Sophie Electric during a

Question:

Month Madison Corp Sophie Electric -4.00% 6.00% -7.00% 12.00% -2.00% 5.00% 7.00% -2.00% -10.00% 15.00% -6.00% 2.00% 2 4

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a The average return is the mean return of the stock and is calculated as the sum of all ...View the full answer

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