Question: Here is the stock price history of "HighTech" and "LowTech" corporations.
a. The annual returns for each stock.
b. The mean (average) return for the period of 10 years for each firm. Which stock has the higher average return?
c. The variance and the standard deviation of returns, for the period of 10 years for each firm. Which stock is riskier?
d. The covariance and correlation of the returns for each firm. Use two formulas to compute the correlation: The Excel formula Correl and the definition
Correlation(rA, rB) = Cov(rA, rB)
σAσA
e. If you had to choose between the two stocks, which would you choose? Explain briefly.