7. For this exercise you would need to use the spreadsheet ps2.xls posted on the Blackboard. The file contains information about monthly returns of twelve stocks, AMGN, AMZN, STX, MSFT, BA, WMT, PFE, ABB, YHOO, AAPL, VZ, GOOG, as well as the value-weighted market index excess return (MKT-RF), and the risk-free rate (RF). The sample period begins on January 2004 and ends December 2012. The spreadsheet is set in a way that you would only need to change the values in cells H122 and T123 in order to control the portfolio weights and the stock/portfolio chosen for the regression calculation. (c) Calculate the amount of idiosyncratic risk as a fraction of total risk (1-) for five portfolios. The first portfolio includes only AMGN. The second portfolio includes the first three stocks, i.e. AMGN, AMZN, and STX. Similarly, portfolios 3 through 5 include the first six, nine, and twelve stocks, respectively. Page 4 of 4 These portfolios can be chosen by changing the value of cell H122 (change also the value of T123 to 14 to run the regressions for this part).