Stock returns (%) of three companies for the last 6 months are given below: Company/Month 1...

Transcribed Image Text:

Stock returns (%) of three companies for the last 6 months are given below: Company/Month 1 3 4 5 DG Cement 7 14 12 -5 -2 Maple Leaf Cement -3 Hussain Textile Ltd 3 Required: 6 4 6 6 10 9 -3 6 -5 -4 8 i). Calculate average monthly rate of return for each stock. ii). Calculate standard deviation of each of the stock. iii). Calculate Covariance and correlation coefficient between rates of return of: i) DG Cement and Maple Leaf cement, and ii) DG Cement and Hussain Textile Ltd iv). Calculate the expected rate of return and standard deviation of a portfolio consisting of 40% of investment in DG Cement and 60% in Hussain textile Ltd by using statistics calculated in part i), ii), & iii) above. Stock returns (%) of three companies for the last 6 months are given below: Company/Month 1 3 4 5 DG Cement 7 14 12 -5 -2 Maple Leaf Cement -3 Hussain Textile Ltd 3 Required: 6 4 6 6 10 9 -3 6 -5 -4 8 i). Calculate average monthly rate of return for each stock. ii). Calculate standard deviation of each of the stock. iii). Calculate Covariance and correlation coefficient between rates of return of: i) DG Cement and Maple Leaf cement, and ii) DG Cement and Hussain Textile Ltd iv). Calculate the expected rate of return and standard deviation of a portfolio consisting of 40% of investment in DG Cement and 60% in Hussain textile Ltd by using statistics calculated in part i), ii), & iii) above.

Answer rating: 100% (QA)

1 for DG cement Total return 2 6 7 14 5 20 Average monthly rate of return would be 20 6 333 For Maple Leaf Total return 3 4 6 12 4 15 Average monthly rate of return 15 6 25 For Hussain Total return 3 ... View the full answer