Question: Please not only fill in the blanks but answer the entire question! Thank you! The following table contains monthly returns for Cola Co. and Gas

Please not only fill in the blanks but answer the entire question! Thank you! The following table contains monthly returns for Cola Co.

Please not only fill in the blanks but answer the entire question! Thank you!

The following table contains monthly returns for Cola Co. and Gas Co. for 2010 (the returns are shown in decimal form, i.e., 0.035 is 3.5%). Using this table and the fact that Cola Co. and Gas Co. have a correlation of -0.0969, calculate the volatility (standard deviation) of a portfolio that is 65% invested in Cola Co. stock and 35% invested in Gas Co. stock. Calculate the volatility by: a. Using the formula: + Var (Ro) = wSD (R1) 2 + w SD(R2) + 2W, W2 Corr (R4, R2) SD (R4) SD(R2) b. Calculating the monthly returns of the portfolio and computing its volatility directly. c. How do your results compare? a. Using the formula: Var (Ro) = w; SD (R1)2 + w SD (R2) + 2W, W2 Corr (R4, R2) SD (R1) SD (R2) The volatility (standard deviation) of the portfolio is %. (Round to two decimal places.) Month Cola Co. Gas Co. -0.0210 0.0280 January February March 0.0000 -0.0050 -0.0200 -0.0180 April 0.0280 0.0090 -0.0310 May 0.0840 June -0.0460 -0.0840 - 0.1190 0.0820 -0.0160 0.0460 0.0550 0.0300 July August September October November December -0.0110 0.0140 -0.0380 0.0290 -0.0220 0.0740

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