What is the correlation between returns of stock S and T, given that covariance between stocks is 2.419 and standard deviation are 1.23 and 2.21, respectively.
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What is the correlation between returns of stock S and T, given that covariance between stocks is 2.419 and standard deviation are 1.23 and 2.21, respectively.
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- Using the data in the following table,, estimate the: a. Average return and volatility for each stock. b. Covariance between the stocks. c. Correlation between these two stocks.a. The standard deviation of returns is 0.30 for Stock A and 0.20 for Stock B. The covariance betweenthe returns of A and B is 0.006. The correlation of returns between A and B is:The covariance between the returns on two stock is 0.0425. The standard deviations of stocks A and B are 0.2041 and 0.2944, respectively. Calculate and interpret the correlations between the two assets
- If the standard deviation of stock 'A' is .25, the standard deviation of stock 'B' is .30, and the correlation between stocks 'A' and 'B' is 0.7, the covariance between stocks 'A' and 'B' is___.The covariance of the market's returns with the stock's returns is 0.008. The standard deviation ofthe market's returns is 0.08, and the standard deviation of the stock's returns is 0. 11. What is thecorrelation coefficient of the returns of the stock and the returns of the market?the variance of stock A is .004, the variance of the market .007 and the covariance between the two is .0026. what is the correlation coefficient?
- If the correlation between two stocks is .49 and the standard deviation of both stocks are 39% and 12% respectively, what is the covariance (in percent) between the two stocks?(a) A stock’s returns have the following distribution: Calculate the stock’s expected return, standard deviation, and the coefficient of variation.(b) the standard deviation of the returns of the stocks A and B
- When finding the covariance, should 2 stocks be used or can it be calculated using 1 stock and the market returns?a. Calculate the expected return for Stock media Prima and Stock Astro 2. Calculate the standard deviation for Stock media Prima and Stock Astro 3. Calculate the covariance and correlation of coefficient for the above stock.(c) Consider information given in the table below and answers the question asked thereafter: i. Calculate expected return on each stock? On the basis of this measure, which stock you will choose?ii. Calculate standard deviation of the returns on each stock? On the basis of this measure, which stock you will choose?iii. Calculate coefficient of variance of the returns on each stock? On the basis of this measure, which stock you will choose?iv. Calculate covariance and coefficient of correlation between the returns of the stocks A and B.v. Now suppose you have $100,000 to invest and you want to a hold a portfolio comprising of $35,000 invested in stock A and remaining amount in stock B. Calculate risk and return of your portfolio. (d) Firm A reports a Profit Margin of 6.5% and a Total Asset Turnover Ratio of 3.25. Their total asset level is $8,500,000. Assume there are 700,000 shares outstanding and the PE ratio is 11. Also, assume the Return on Equity is 16%. Based on this, calculate…