Question: Consider the following table, which gives historical returns on two stocks and the market: Year Stock A Price Stock B Price 2017 100 40 2018

Consider the following table, which gives historical returns on two stocks and the market:

Year

Stock A Price

Stock B Price

2017

100

40

2018

102

42

2019

104

44

Assume that these returns can be used to estimate the expectation, variance, and covariance of future returns.

1.

What are the holding period returns on stocks A&B in 2018?

2. What are the expected returns for stocks A&B ?

3. What is the standard deviation of stock A?

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