a. Calculate the yearly returns for both stocks Year Stock Price A Yearly Return
ID: 2731526 • Letter: A
Question
a. Calculate the yearly returns for both stocks
Year
Stock Price A
Yearly Return (%)
Stock Price B
Yearly Return (%)
1
$ 100
$ 65
2
$ 112
12.0%
$ 70
7.7%
3
$ 118
5.4%
$ 79
12.9%
4
$ 106
-10.2%
$ 83
5.1%
5
$ 110
3.8%
$ 80
-3.6%
6
$ 91
-17.3%
$ 95
18.8%
7
$ 105
15.4%
$ 94
-1.1%
8
$ 125
19.0%
$ 108
14.9%
9
$ 155
24.0%
$ 120
11.1%
10
$ 185
19.4%
$ 125
4.2%
b. Calculate the average yearly returns:
c. Calculate the standard deviation:
d. Which if these stocks was less risky? Explain
a. Calculate the yearly returns for both stocks
Year
Stock Price A
Yearly Return (%)
Stock Price B
Yearly Return (%)
1
$ 100
$ 65
2
$ 112
12.0%
$ 70
7.7%
3
$ 118
5.4%
$ 79
12.9%
4
$ 106
-10.2%
$ 83
5.1%
5
$ 110
3.8%
$ 80
-3.6%
6
$ 91
-17.3%
$ 95
18.8%
7
$ 105
15.4%
$ 94
-1.1%
8
$ 125
19.0%
$ 108
14.9%
9
$ 155
24.0%
$ 120
11.1%
10
$ 185
19.4%
$ 125
4.2%
b. Calculate the average yearly returns:
c. Calculate the standard deviation:
d. Which if these stocks was less risky? Explain
Explanation / Answer
A) AVERAGE RETURN
Higher the CV, Higher the risk
Stocks A is more risky
Return(a) d=a-avg return e = d*d Return(a) d=a-avg return e = d*d 0 -12.66 160.28 0 -7.94 63.04 13.44 0.78 0.61 5.39 -2.55 6.50 6.372 -6.288 39.54 10.191 2.251 5.07 10.812 -1.848 3.42 4.233 -3.707 13.74 4.18 -8.48 71.91 2.88 -5.06 25.60 15.834 3.174 10.07 17.86 9.92 98.41 16.17 3.51 12.32 1.034 -6.906 47.69 23.75 11.09 122.99 16.092 8.152 66.46 37.2 24.54 602.21 13.32 5.38 28.94 35.89 23.23 539.63 5.25 -2.69 7.24 163.65 1562.98 76.25 362.69Related Questions
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