Need help ASAP Please!!
One theory about the daily changes in the closing price of a stock is that these changes follow a random walk- that is, these daily events are independent of each other and move upward or downward in a random manner - and can be approximated by a normal distribution. To test this theory, collect the opening and closing prices of stocks from for your favorite company or brand.
Initial Post:
- Choose your favorite company or brand and search finance.yahoo.com with that company name and "historical stock prices." Download the stock history for this company for the past 6 weeks by selecting the appropriate dates and clicking on "Download to Spreadsheet" at the bottom of page.
- Calculate the daily change in the closing stock prices by taking the difference between the closing and opening price for the day. This is the daily stock change.
- Calculate the mean and standard deviation of the daily stock changes by running the Descriptive Statistics in Excel Data Analysis. Share the summary table.
- Consider the mean, median and mode (if it exists). Is your daily stock change distribution right skewed (median < mean), left skewed (mean < median), or symmetric (mean ≈ median)? What other considerations would you look at to determine whether or not this distribution is approximately normally distributed?