Calculate the standard deviations of the returns for bartman

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Reference no: EM131052959

Bartman Industries' and Reynolds Inc.'s stock prices and dividends, along with the Winslow 5000 Index, are shown below for the period 2000-2005.  The Winslow 5000 data are adjusted to include dividends.

a. Use the data to calculate annual rates of return for Bartman, Reynolds, and the Winslow 5000 Index, and then calculate each entity's average return over the five-year period. (Hint: Remember, returns are calculated by subtracting the beginning price from the ending price to get the capital gain or loss, adding the dividend to the capital gain or loss, and dividing the result by the beginning price. Assume that dividends are already included in the index. Also, you cannot calculate the rate of return for 2000 because you do not have 1999 data.)

 

Bartman Industries

Reynolds Incorporated

Winslow 5000

Year

Stock Price

Dividend

Stock Price

Dividend

Includes Divs.

2005

$17.250

$1.150

$48.750

$3.000

11,663.98

2004

14.750

1.060

52.300

2.900

8,785.70

2003

16.500

1.000

48.750

2.750

8,679.98

2002

10.750

0.950

57.250

2.500

6,434.03

2001

11.375

0.900

60.000

2.250

5,602.28

2000

7.625

0.850

55.750

2.000

4,705.97

b. Calculate the standard deviations of the returns for Bartman, Reynolds, and the Wiinslow 5000. (Hint: Use the sample standard deviation formula, 8-3a, which corresponds to the STDEV function in Excel.)

c. Now calculate the coefficients of variation for Bartman, Reynolds, and the Wiinslow 5000.

d. Construct a scatter diagram graph that shows Bartman's and Reynolds' returns on the vertical axis and the Winslow Index's returns on the horizontal axis.

Reference no: EM131052959

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