What is the correlation between the returns of the two stock

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Reference no: EM131820227

You are given the following information: State of Economy Probability of State of Economy Return on Stock J Return on Stock K Bear .30 −.025 .029 Normal .65 .133 .057 Bull .05 .213 .087 Calculate the expected return for each of the stocks. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places (e.g., 32.16).) Expected return Stock J 8.96 % Stock K 5.01 % Calculate the standard deviation for each of the stocks. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places (e.g., 32.16).) Standard deviation Stock J 7.70 % Stock K 1.53 % What is the covariance between the returns of the two stocks? (Do not round intermediate calculations and round your answer to 6 decimal places (e.g., 32.161616).) Covariance What is the correlation between the returns of the two stocks? (Do not round intermediate calculations and round your answer to 4 decimal places (e.g., 32.1616).) Correlation

Reference no: EM131820227

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