Using the data in the following table,

Year	2010		2011		2012		2013		2014		2015
Stock A	3%		9%		9%		7%		4%		15%
Stock B	28%		33%		20%		1%		8%		24%

estimate the:

a. Average return and volatility for each stock.

b. Covariance between the stocks.

c. Correlation between these two stocks.

Question content area bottom

Part 1

a. Estimate the average return and volatility for each stock.

The average return of stock A is

4.54.5%.

(Round to two decimal places.)

Part 2

The average return of stock B is

1616%.

(Round to two decimal places.)

Part 3

The standard deviation of stock A is

0.082400.08240.

(Round to five decimal places.)

Part 4

The standard deviation of stock B is

0.166010

(Round to five decimal places.)

Part 5

b. Estimate the covariance between the stocks.

The covariance is :