1) Rate of Return
Year Asset A Asset B Market Index
1 8.0% 19.0% 9.0%
2 -11.0% 12.0% 14.0%
3 18.0% 19.0% 4.0%
4 -2.0% -14.0% -4.0%
5 12.0% 13.0% 17.0%
i) Compute Average Rate of Return on two Assets and = Market Index (Use the =Average function)
ii) Determine the Standard Deviation of Returns for two Assets and = Market Index? (Use the =STDEV function)
ii) Determine Correlation of Returns for Asset A and B, Asset A with Market Index and Asset B with the Market Index? (Use the =correl function)
iv) Compute Expected Return and Standard Deviation of Returns for Porfolios with given composition:
% Asset A % Asset B
Expected Return Std Dev of Returns
0 100%
25% 75%
50% 50%
75% 25%
100% 0%
v) Design a curve for Feasable Set of Portfolio outcomes by using data from (iv) with Portfolio Std Dev on X-Axis and Portfolio Expected Returns on the Y-Axis
(Use Insert and then Scatter Plot under the Chart functions)