Using the spreadsheet information below, a Determine how much a passive investor would have on December 31, 2011 if she invested $10,000 on January 1, 2002 in the passive portfolio b Determine how much a passive investor would have on December 31, 2011 if she invested $10,000 on January 1, 2002 in the active portfolio c Which portfolio was more risky d Calculate the correlation between the returns for these two portfolios e How do you explain the close association in returns Vanguard 500 Index Fund Vanguard Growth Income Fund 201 1 2010 2009 2008 2007 2006 2005 2004 2003 2002 2 08 15 05 26 62 36 97 5 47 15 75 4 87 10 82 28 59 22 10 2 42 14 62 22 42 37 72 2 62 14 01 5 82 11 11 30 15 21 92

Question: Using the spreadsheet information below, a. Determine how much a passive investor would have on December 31, 2011 if she invested $10,000 on January 1,

Using the spreadsheet information below,
a. Determine how much a passive investor would have on December 31, 2011 if she invested $10,000 on January 1, 2002 in the passive how much a passive investor would have on December 31, 2011 if she invested $10,000 on January 1, 2002 in the active Which was more risky?
d. Calculate the correlation between the returns for these two portfolios
e. How do you explain the close association in returns?

Vanguard 500 Index Fund Vanguard Growth & Income Fund 201 1 2010 2009 2008 2007 2006 2005 2004 2003 2002 2.08% 15.05% 26.62% -36.97% 5.47% 15.75% 4.87% 10.82% 28.59% -22.10% 2.42% 14.62% 22.42% -37.72% 2.62% 14.01% 5.82% 11.11% 30.15% -21.92%

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