Data Price Return Date AAPL AMZN XOM SP 500 AAPL AMZN XOM SP

Data:

	Price				Return
Date	AAPL	AMZN	XOM	S&P 500	AAPL	AMZN	XOM	S&P 500
2/1/2012	52.26	179.69	70.4	1365.68
3/1/2012	57.76	202.51	70.97	1408.47	10.52%	12.70%	0.81%	3.13%
4/1/2012	56.26	231.9	70.65	1397.91	-2.60%	14.51%	-0.45%	-0.75%
5/1/2012	55.66	212.91	64.34	1310.33	-1.07%	-8.19%	-8.93%	-6.27%
6/1/2012	56.26	228.35	70.5	1362.16	1.08%	7.25%	9.57%	3.96%
7/1/2012	58.84	233.3	71.56	1379.32	4.59%	2.17%	1.50%	1.26%
8/1/2012	64.09	248.27	71.93	1406.58	8.92%	6.42%	0.52%	1.98%
9/1/2012	66.25	254.32	75.84	1440.67	3.37%	2.44%	5.44%	2.42%
10/1/2012	59.12	232.89	75.61	1412.16	-10.76%	-8.43%	-0.30%	-1.98%
11/1/2012	58.12	252.05	73.09	1416.18	-1.69%	8.23%	-3.33%	0.28%
12/1/2012	54.59	250.87	72.22	1426.19	-6.07%	-0.47%	-1.19%	0.71%
1/1/2013	46.72	265.5	75.08	1498.11	-14.42%	5.83%	3.96%	5.04%
2/1/2013	45.28	264.27	74.73	1514.68	-3.08%	-0.46%	-0.47%	1.11%
3/1/2013	47.32	266.49	75.68	1569.19	4.51%	0.84%	1.27%	3.60%
4/1/2013	47.34	253.81	74.73	1597.57	0.04%	-4.76%	-1.26%	1.81%
5/1/2013	48.08	269.2	75.98	1630.74	1.56%	6.06%	1.67%	2.08%
6/1/2013	44.44	277.69	76.4	1606.28	-7.57%	3.15%	0.55%	-1.50%
7/1/2013	50.71	301.22	79.28	1685.73	14.11%	8.47%	3.77%	4.95%
8/1/2013	54.6	280.98	73.7	1632.97	7.67%	-6.72%	-7.04%	-3.13%
9/1/2013	56	312.64	73.26	1681.55	2.56%	11.27%	-0.60%	2.97%
10/1/2013	61.4	364.03	76.31	1756.54	9.64%	16.44%	4.16%	4.46%
11/1/2013	65.32	393.62	79.59	1805.81	6.38%	8.13%	4.30%	2.80%
12/1/2013	68.69	398.79	86.75	1848.36	5.16%	1.31%	9.00%	2.36%
1/1/2014	61.29	358.69	79	1782.59	-10.77%	-10.06%	-8.93%	-3.56%
2/1/2014	64.43	362.1	82.53	1859.45	5.12%	0.95%	4.47%	4.31%
3/1/2014	68.57	336.37	84.33	1872.34	6.43%	-7.11%	2.18%	0.69%
4/1/2014	75.39	304.13	88.41	1883.95	9.95%	-9.58%	4.84%	0.62%
5/1/2014	80.87	312.55	86.79	1923.57	7.27%	2.77%	-1.83%	2.10%
6/1/2014	86.47	324.78	87.51	1960.23	6.92%	3.91%	0.83%	1.91%
7/1/2014	88.95	312.99	86	1930.67	2.87%	-3.63%	-1.73%	-1.51%
8/1/2014	95.37	339.04	86.45	2003.37	7.22%	8.32%	0.52%	3.77%
9/1/2014	94.21	322.44	82.32	1972.29	-1.22%	-4.90%	-4.78%	-1.55%
10/1/2014	100.99	305.46	84.64	2018.05	7.20%	-5.27%	2.82%	2.32%
11/1/2014	111.21	338.64	79.24	2067.56	10.12%	10.86%	-6.38%	2.45%
12/1/2014	103.66	310.35	81.5	2058.9	-6.79%	-8.35%	2.85%	-0.42%
1/1/2015	110.03	354.53	77.07	1994.99	6.15%	14.24%	-5.44%	-3.10%
2/1/2015	120.64	380.16	78.05	2104.5	9.64%	7.23%	1.27%	5.49%
3/1/2015	117.32	372.1	75.5	2067.89	-2.75%	-2.12%	-3.27%	-1.74%
4/1/2015	118	421.78	77.6	2085.51	0.58%	13.35%	2.78%	0.85%
5/1/2015	122.84	429.23	75.67	2107.39	4.10%	1.77%	-2.49%	1.05%
6/1/2015	118.76	434.09	74.51	2063.11	-3.32%	1.13%	-1.53%	-2.10%
7/1/2015	114.85	536.15	70.94	2103.84	-3.29%	23.51%	-4.79%	1.97%
8/1/2015	106.91	512.89	67.38	1972.18	-6.91%	-4.34%	-5.02%	-6.26%
9/1/2015	104.91	511.89	67.21	1920.03	-1.87%	-0.19%	-0.25%	-2.64%
10/1/2015	113.66	625.9	74.79	2079.36	8.34%	22.27%	11.28%	8.30%
11/1/2015	112.51	664.8	73.81	2080.41	-1.01%	6.22%	-1.31%	0.05%
12/1/2015	100.54	675.89	71.08	2043.94	-10.64%	1.67%	-3.70%	-1.75%
1/1/2016	92.98	587	70.98	1940.24	-7.52%	-13.15%	-0.14%	-5.07%
2/1/2016	92.35	552.52	73.08	1932.23	-0.68%	-5.87%	2.96%	-0.41%
3/1/2016	104.67	593.64	76.91	2059.74	13.34%	7.44%	5.24%	6.60%
4/1/2016	90.02	659.59	81.34	2065.3	-14.00%	11.11%	5.76%	0.27%
5/1/2016	95.9	722.79	81.91	2096.95	6.53%	9.58%	0.70%	1.53%
6/1/2016	92.37	715.62	86.97	2098.86	-3.68%	-0.99%	6.18%	0.09%
7/1/2016	100.69	758.81	82.53	2173.6	9.01%	6.04%	-5.11%	3.56%
8/1/2016	102.51	769.16	80.85	2170.95	1.81%	1.36%	-2.04%	-0.12%
9/1/2016	109.82	837.31	81.67	2168.27	7.13%	8.86%	1.01%	-0.12%
10/1/2016	110.3	789.82	77.96	2126.15	0.44%	-5.67%	-4.54%	-1.94%
11/1/2016	107.36	750.57	81.69	2198.81	-2.67%	-4.97%	4.78%	3.42%
12/1/2016	113.09	768.66	85.21	2238.83	5.34%	2.41%	4.31%	1.82%
1/1/2017	118.49	823.48	79.19	2278.87	4.77%	7.13%	-7.06%	1.79%
2/1/2017	133.76	845.04	76.77	2363.64	12.89%	2.62%	-3.06%	3.72%
3/1/2017	140.88	886.54	78.13	2362.72	5.32%	4.91%	1.77%	-0.04%
4/1/2017	140.87	924.99	77.78	2384.2	-0.01%	4.34%	-0.45%	0.91%
5/1/2017	149.8	994.62	76.69	2411.8	6.34%	7.53%	-1.40%	1.16%
6/1/2017	141.82	968	77.63	2423.41	-5.33%	-2.68%	1.23%	0.48%
7/1/2017	146.45	987.78	76.97	2470.3	3.26%	2.04%	-0.85%	1.93%
8/1/2017	161.49	980.6	73.4	2471.65	10.27%	-0.73%	-4.64%	0.05%
9/1/2017	152.36	961.35	79.6	2519.36	-5.65%	-1.96%	8.45%	1.93%
10/1/2017	167.11	1105.28	80.93	2575.26	9.68%	14.97%	1.67%	2.22%
11/1/2017	169.88	1176.75	80.87	2584.84	1.66%	6.47%	-0.07%	0.37%
12/1/2017	167.9	1169.47	81.96	2673.61	-1.17%	-0.62%	1.35%	3.43%
Mean	93.94873239	511.9949296	77.49225352	1942.237887	1.90%	2.99%	0.31%	1.00%
Stand. Dev	34.74011978	277.2164875	5.317289373	348.6732082	6.71%	7.60%	4.24%	2.76%
Covariance Matrix
	AAPL	AMZN	XOM	S&P 500
AAPL	0.004497798	0.001684058	0.000221461	0.000910849
AMZN	0.001684058	0.005772017	0.000578501	0.001100179
XOM	0.000221461	0.000578501	0.001801273	0.000673649
S&P 500	0.000910849	0.001100179	0.000673649	0.000761622

Problem 1 (50 points) All Financial Data should only be obtained from the website https://finance.yahoo.com Consider the monthly adjusted closing prices of Apple Inc. (AAPL), Ama zon.com I. (AMZN), Wal-Mart Stores Inc. (WMT) and Exxon Mobil Corp. (XOM) from February 1, 2012 to December 29, 2017 1. Using Excel or any other spreadsheet software, find the expected monthly rates of return and standard deviation of monthly rates of return for each of these stocks. Moreover, find the covariance of monthly rates of return for each pair these stocks.

Solution

AAPL AMZN 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 Expected Return 0.63% 2.21% 3.69% -0.08% 1.25% 3.50% Expected Return 3.66% 4.13% -1.84% 7.06% 1.35% 3.67% S.D 0.065256 0.077662 0.066183 0.061219 0.076242 0.059119 S.D 0.078045 0.070619 0.070619 0.093069 0.076079 0.050266 XOM S&P 500 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 Expected Return 0.36% 1.61% -0.43% -1.04% 1.59% -0.26% Expected Return 0.47% 2.21% 0.93% 0.01% 0.80% 1.50% S.D 0.048941 0.039549 0.043966 0.046325 0.039427 0.038554 S.D 0.029623 0.024703 0.023414 0.039428 0.029481 0.012388