Question: Please answer the following question allied toten off return a beta, B, equal to 2.5? ST-4 Stock A and Stock B have the following historical
Please answer the following question

allied toten off return a beta, B, equal to 2.5? ST-4 Stock A and Stock B have the following historical returns: Year * Stock A's Returns, FA Stock B's Returns, is 2004 -10.00% -3.00% 2005 18.50 21.29 2006 38.67 44.25 2007 14.33 3.67 2008 33.00 28.30 8-2 What is th a. Calculate the average rate of return for each stock during the period 2004-2008. Assume that someone held a portfolio consisting of 50 per- cent Stock A and 50 percent Stock B. What would have been the realized rate of return on the portfolio in each year from 2004 through 2008? What would have been the average return on the portfolio during this period? b. Calculate the standard deviation of returns for each stock and for the portfolio. Use Equation 8 4. 8-3 Susan c. Looking at the annual returns data on the two stocks, would you guess that value - invest the correlation coefficient between returns on the two stocks is closer to 0.9 or to -0.9? adds 84 Sup
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