Compute a 5-year moving average and weighted moving average.
A. I see a lot of moving-average charts in stock reports. What is the moving-average method and how is it useful?
B. What does weighting add to the usefulness of moving averages and how is it done?
C. The yield on a 30-year treasury note at the end of each year since 1990 is recorded below.
Compute a five-year (1) moving average and (2) weighted moving average using weights of .1, .1, .2, .3, and .3, respectively. Describe the trend in yield both in both narrative and graphical form.
|
1990
|
8061
|
|
1991
|
8.14
|
|
1992
|
7.67
|
|
1993
|
6.59
|
|
1994
|
7.37
|
|
1995
|
6088
|
|
1996
|
6071
|
|
1997
|
6061
|
|
1998
|
5.58
|
|
1999
|
5.87
|
|
2000
|
5.94
|
|
2001
|
5.49
|
|
2002
|
5043
|