Question: Please provide me with excel formulas to calculate standard deviations and coefficient of correlations for these homework 3. Now calculate the standard deviations and coefficients
Please provide me with excel formulas to calculate standard deviations and coefficient of correlations for these homework
| 3. Now calculate the standard deviations and coefficients of variation of returns for the four alternatives. What type of risk do these | |||||||||
| statistics measure? Is the standard deviation or the coefficient of variation the better measure? How do the alternatives compare when risk | |||||||||
| is considered? | |||||||||
| Standard deviation measures the dispersion of an investment's return around the expected return. | |||||||||
| The coefficient of variation is a statistical measure of relative dispersion that can be used to compare the risks of assets with different expected returns. | |||||||||
| 1-Year | Exp | Deviation | Deviation | Summation | Standard | Coefficient of | |||
| State of Economy | Probability | T-Bond | Returns | Squared | Deviation | Deviation | Variation | ||
| Recession | 0.1 | 0.08 | 0.08 | 0 | 0 | 0 | |||
| Below Average | 0.2 | 0.08 | 0.08 | 0 | 0 | 0 | |||
| Average | 0.4 | 0.08 | 0.08 | 0 | 0 | 0 | |||
| Above Average | 0.2 | 0.08 | 0.08 | 0 | 0 | 0 | |||
| Boom | 0.1 | 0.08 | 0.08 | 0 | 0 | 0 | |||
| Total | 1 | 0 | 0 | 0 | |||||
| Average | |||||||||
| Standard Deviation | 0 | Coefficient of Variation | 0 | ||||||
| Exp | Deviation | Deviation | Summation | Standard | Coefficient of | ||||
| State of Economy | Probability | TECO | Returns | Squared | Deviation | Deviation | Variation | ||
| Recession | 0.1 | -0.08 | 0.135 | -0.215 | 0.046225 | 0.0046225 | |||
| Below Average | 0.2 | 0.02 | 0.135 | -0.115 | 0.013225 | 0.002645 | |||
| Average | 0.4 | 0.14 | 0.135 | 0.005 | 0.000025 | 0.00001 | |||
| Above Average | 0.2 | 0.25 | 0.135 | 0.115 | 0.013225 | 0.002645 | |||
| Boom | 0.1 | 0.33 | 0.135 | 0.195 | 0.038025 | 0.0038025 | |||
| Total | 1 | 0.013725 | 0.1171537451 | 0.8678055195 | |||||
| Average | |||||||||
| Standard Deviation | 0.1171537451 | Coefficient of Variation | 0.8678055195 | ||||||
| Exp | Deviation | Deviation | Summation | Standard | Coefficient of | ||||
| State of Economy | Probability | Gold Hill | Returns | Squared | Deviation | Deviation | Variation | ||
| Recession | 0.1 | 0.18 | 0.088 | 0.092 | 0.008464 | 0.0008464 | |||
| Below Average | 0.2 | 0.23 | 0.088 | 0.142 | 0.020164 | 0.0040328 | |||
| Average | 0.4 | 0.07 | 0.088 | -0.018 | 0.000324 | 0.0001296 | |||
| Above Average | 0.2 | -0.03 | 0.088 | -0.118 | 0.013924 | 0.0027848 | |||
| Boom | 0.1 | 0.02 | 0.088 | -0.068 | 0.004624 | 0.0004624 | |||
| Total | 1 | 0.008256 | 0.09086253353 | 1.03252879 | |||||
| Average | |||||||||
| Standard Deviation | 0.09086253353 | Coefficient of Variation | 1.03252879 | ||||||
| Exp | Deviation | Deviation | Summation | Standard | Coefficient of | ||||
| State of Economy | Probability | S&P 500 | Returns | Squared | Deviation | Deviation | Variation | ||
| Recession | 0.1 | -0.15 | 0.15 | -0.3 | 0.09 | 0.009 | |||
| Below Average | 0.2 | 0 | 0.15 | -0.15 | 0.0225 | 0.0045 | |||
| Average | 0.4 | 0.15 | 0.15 | 0 | 0 | 0 | |||
| Above Average | 0.2 | 0.3 | 0.15 | 0.15 | 0.0225 | 0.0045 | |||
| Boom | 0.1 | 0.45 | 0.15 | 0.3 | 0.09 | 0.009 | |||
| Total | 1 | 0.027 | 0.1643167673 | 1.095445115 | |||||
| Average | |||||||||
| Standard Deviation | 0.1643167673 | Coefficient of Variation | 1.095445115 | ||||||
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