Question: Given the returns and probabilities for the three possible states listed here, calculate the covariance between the returns of Stock A and Stock B. For
Given the returns and probabilities for the three possible states listed here, calculate the covariance between the returns of Stock A and Stock B. For convenience, assume that the expected returns of Stock A and Stock B are 0.12 and 0.18, respectively. (Round your answer to 4 decimal places. For example .1244)
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| Probability | Return(A) | Return(B) |
| Good | 0.35 | 0.30 | 0.50 |
| OK | 0.50 | 0.10 | 0.10 |
| Poor | 0.15 | -0.25 | -0.30 |
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