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  3. stocks a and b have the following historical retur

Stocks A and B have the following historical returns: Year Ra,...

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Finance

Stocks A and B have the following historical returns:

Year Ra, Stock As returns in % Rb, Stock Bs returns in %
1 -16 -12.50
2 30 19
3 14 25
4 -0.5 -7.5
5 20 18

a. Calculate the average rate of return (mean) for each stock during the periods 1-5. b. Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B. What would the realized rate of return on the portfolio have been each year? What would the average rate of return be on the portfolio during this period? c. Calculate the standard deviation of returns for each stock and the portfolio. d. Calculate the coefficient of variation for each stock and portfolio.

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