1. Xerox and Yirox are big names in the Food industry. The following data are for the actual returns on shares of Xerox (X) and that of Yirox (Y):

Year Stock X’s Returns, rX Stock Y’s Returns, rY	Stock X’s Returns, rX	Stock Y’s Returns, rY
2015	(24.25%)	5.50%
2016	18.50	26.73
2017	38.67	48.25
2018	14.33	(4.5)
2019	39.13	43.86

1. Calculate the average rate of return for each stock during the period 2015 through 2019.

2. Assume that someone held a portfolio consisting of thrice as many shares of Stock X than that of Stock

Y. What would be the expected return of this portfolio investment?

3. Now calculate the standard deviation of return for the portfolio.

4. Calculate the coefficient of variation of this portfolio investment.

5. Interpret the coefficient of variation of the portfolio to help make sound decision.

Answer rating: 100% (QA)

To calculate the average rate of return for each stock during the period 2015 through 2019 we will use the formula Average Rate of Return Sum of Retur... View the full answer