Question: AAA and BBB are daily stock returns. Compute the maximum, minimum and the average return. Calculate the risk associated to each stock. Make a Table

AAA and BBB are daily stock returns.

  1. Compute the maximum, minimum and the average return. Calculate the risk associated to each stock.
  2. Make a Table including 30 bins with fixed increment. The first bin should include the minimum return and the 30thbin corresponds to the maximum return.
  3. Calculate the frequency distribution based on created bins.
  4. Compute the relative frequency and plot the corresponding graph.
  5. Determine the cumulative distribution and plot the corresponding graph.
  6. Using the first order and second order stochastic dominance, which stock is preferred. Explain.

AAA : -0.020216 0.0133751 -0.014723 0.0089486 -0.010073 0.0087356 -0.003351 -0.004261 -0.012437 -0.003191 0.0104451 0.0123472 -0.010316 0.004274 0.0102725 0.0555278 0.0294078 -0.019994 -0.007943 0 -0.010549 0.0126451 0.0060549 0.0031175 -0.015686 -0.011661 -0.02352 -0.012081 0.0026484 0.0089962 0.0263003 0.0145741 -0.000839 -0.017786 -0.00171 -0.010109 0.0126734 0.0116712 -0.004228 -0.004459 -0.001917 -0.011796 0.0064516 0.002569 -0.00579 -0.008206 -0.005871 -0.052614 0.010974 -0.009825 0.0020645 -0.004133 -0.004381 0.0167301 -0.000455 -0.005243 0.0097806 0.007217 0.0049316 -0.000447 -0.012154 0.0076698 0 0 -0.0113 0.0022701 -0.009569 -0.018252 -0.001633 0.0088352 -0.000232 -0.008137 0.0060508 -0.014019 -0.007558 -0.041385 -0.03061 0.018928 0.0124225 0.0207704 -0.003634 0.0012129 0.0016955 0.0091545 -0.029199 0 -0.007435 0 0.0084221 -0.01341 0.0283445 0.007264 0.0012055 0.0190937 0.0133852 -0.001634 0 0.0011675 -0.0007 -0.00656 -0.010397 -0.002378 -0.011976 -0.009442 0.009442 -0.003621 -0.008744 0.0002439 -0.010297 -0.014396 0.0099503 -0.0102 -0.007278 0.0075283 0.001998 -0.032457 -0.03782 -0.032371 0.0379758 -0.023157 0.0032635 -0.009 0.0163047 -0.030098 0.0124225 -0.012423 0.0063686 0.0250763 0.0091105 -0.007765 -0.028632 0.0046916 0.0234024 0.0138891 -0.01174 -0.006732 -0.028503 -0.005017 -0.033526 -0.014259 -0.000586 0.0128207 -0.032365 -0.040897 -0.042966 0.0256836 0.0425068 0.0322801 0.021819 0.0071685 0.0059821 -0.005982 -0.027518 -0.022273 0.0029985 -0.0042 0.0220051 -0.023811 -0.020387 -0.00524 -0.011187 0.0155042 -0.047253 0 -0.033457 0.0019993 -0.034889 0.0385443 0.0339126 0.0250132 -0.047056 -0.0456 -0.001373 -0.020476 -0.009512 0.0137109 -0.011943 0.0168189 -0.001043 -0.003484 0.0268611 0.0023757 0.0127991 -0.002681 0.006689 0.0013324 0.0013307 -0.026273 -0.000341 -0.013405 0.012038 0.0253178 0 -0.027029 0.007506 0.0118265 -0.026205 -0.125094 -0.027334 0.0190937 -0.029185 -0.030898 0.0247947 -0.010257 0.056127 0.0288204 0.0037807 -0.029876 -0.004677 -0.046371 0.0065253 -0.003257 0.0052878 0.0140989 -0.006018 -0.019095 0.010608 0.0080841 0.0064206 0.0031949 0.0130721 0.0267925 0.0125644 -0.003031 -0.006091 -0.020834 0.0326012 0.0301082 -0.000366 -0.015504 0.0162365 0.0069305 0.0176549 -0.014026 -0.005812 0.0276648 -0.013198 -0.015925 -0.004021 -0.037318 -0.007634 0.0208538 -0.020854 0.0163409 0.0018829 0.0332994 0.0007275 0.0180185 -0.014389 0.0072202 0.0089526 0.0131045 0.0534374 -0.005687 0.0143216 0 0 -0.024775

BBB : -0.0831149 -0.0687704 -0.064781 -0.0637545 -0.0610343 -0.0595007 -0.0559171 -0.0490462 -0.0458095 -0.0452813 -0.0449823 -0.0436872 -0.0430174 -0.0419774 -0.0416557 -0.0409094 -0.03861 -0.0375959 -0.0372958 -0.0356068 -0.0350913 -0.0340004 -0.0318817 -0.0314987 -0.0309502 -0.030483 -0.029568 -0.0291283 -0.0281709 -0.0281709 -0.0270006 -0.0269075 -0.0267957 -0.0264956 -0.0263844 -0.0251812 -0.0241883 -0.0237422 -0.0236882 -0.0222207 -0.021023 -0.0209007 -0.0203522 -0.0202897 -0.0200828 -0.0191292 -0.018905 -0.018729 -0.0185462 -0.0183261 -0.0181966 -0.0175641 -0.0169018 -0.0167815 -0.0155042 -0.0152094 -0.0151259 -0.0150938 -0.0144193 -0.0138479 -0.013423 -0.0129591 -0.0123756 -0.0123256 -0.0116984 -0.011372 -0.0107344 -0.0106745 -0.0104713 -0.0103045 -0.0101883 -0.0101756 -0.0096014 -0.0095491 -0.009533 -0.0092261 -0.009138 -0.008955 -0.0087142 -0.0086166 -0.0085593 -0.0085163 -0.0084567 -0.0082731 -0.0080682 -0.0078332 -0.0078278 -0.0072993 -0.0068729 -0.006734 -0.0066445 -0.0063507 -0.0058585 -0.0057637 -0.0056765 -0.0056657 -0.0054419 -0.0054397 -0.0054152 -0.0048615 -0.0046019 -0.0045352 -0.0044904 -0.0043956 -0.0042418 -0.0040486 -0.003937 -0.0038536 -0.0035714 -0.0035587 -0.0034305 -0.0033841 -0.0032584 -0.0032 -0.0031898 -0.0029311 -0.0029226 -0.0028227 -0.0026513 -0.0026408 -0.0022262 -0.0018921 -0.0013847 -0.0012456 -0.0009955 -0.0009867 -0.0009583 -0.0009357 -0.0008505 -0.000433 -0.0004255 0 0 0 0 0 0 0 0 0 0 0.0010178 0.0016267 0.0018198 0.0019249 0.0019608 0.0019743 0.002004 0.0022247 0.0026008 0.0027998 0.0028057 0.0033396 0.0033948 0.0034622 0.0035232 0.0035414 0.0037807 0.0039331 0.004386 0.004635 0.0047463 0.0050736 0.0056304 0.0056765 0.0060448 0.0061539 0.0063358 0.0066635 0.0066932 0.0068061 0.0068864 0.0071302 0.0078125 0.0079921 0.0082988 0.0084969 0.0085047 0.0085674 0.0085837 0.0090498 0.0092541 0.0096062 0.0096113 0.009804 0.0102524 0.0114287 0.0123827 0.0125899 0.0127704 0.013411 0.0135108 0.0136988 0.0139429 0.0144303 0.0145824 0.0147479 0.0148886 0.0152675 0.0160003 0.016024 0.0161012 0.0161874 0.0165293 0.0168181 0.0171982 0.0172418 0.0174351 0.0175055 0.0179994 0.0180185 0.0192499 0.0195319 0.0201611 0.020509 0.0208247 0.0208341 0.020985 0.0215062 0.021751 0.0224493 0.0236953 0.0240752 0.0245855 0.024717 0.0255651 0.0265832 0.0267138 0.0271598 0.0279203 0.0293457 0.0294428 0.0298457 0.0307149 0.0307211 0.0317224 0.0366816 0.0376092 0.0378205 0.0380719 0.0398545 0.0405884 0.0445602 0.0448131 0.0472091 0.0487902 0.0492436 0.0494374 0.0530727 0.0541413 0.0605841 0.0618906 0.0624228 0.0629138 0.0747761 0.0777813 0.0839419 0.0853796

Above data are from 2 different stock return AAA and BBB. for example day 1: AAA return : -0.020216, BBB return : -0.0831149 and so on. Theses data are from excel sheet.

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