Question: QUESTION 17 Consider the following table, which gives historical returns on two stocks and the market: Year Stock A Price Stock B Price 2017 100

QUESTION 17

  1. 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 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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