In: Finance
Here are the returns on two stocks.
Digital Cheese Executive Fruit
January +14 +7
February −3 +1
March +5 +4
April +7 +12
May −4 +2
June +3 +7
July −2 −3
August −8 −2
Required: a-1. Calculate the variance and standard deviation of each stock. a-2. Which stock is riskier if held on its own? b. Now calculate the returns in each month of a portfolio that invests an equal amount each month in the two stocks. c. Is the variance more or less than halfway between the variance of the two individual stocks?