Following statistical calculation methods can be used as a guide only

Tutorial -2, Q-5 (only second and fourth series are considered for demonstration purposes)
Data: Calculate

S&P Russell a) The 𝜠(𝑹) for S&P500 and Nikkei

Month DJIA Nikkei b) The SD for S&P500 and Nikkei
500 2000
c) The COV between the rates of return for
1 0.03 0.02 0.04 0.04 S&P 500 and Nikkei
2 0.07 0.06 0.1 -0.02 d) The r2,4 (CORREL) S&P500 and Nikkei
3 -0.02 -0.01 -0.04 0.07 e) Calculate expected return and SD of a
4 0.01 0.03 0.03 0.02 portfolio consisting equal parts of
5 0.05 0.04 0.11 0.02 S&P500 and Nikkei
6 -0.06 -0.04 -0.08 0.06
First, enter the data from the table: How can we edit a value?

eg. typed incorrectly

• Clear memory –
• (Input each historical rates, in pairs (S&P,Nikkei),
in order of each month and press 𝜮+ each time.) • Press , then , then use + or –
to Navigate/Scroll through the
i.e. 0.02 0.04, (1st period appears) entries.
• Once on the desired entry, overwrite
then 0.06 0.02 (2nd period appears) by typing the new value and then
…repeat for each pair press to store it.

5(a) Expected Returns:

• Find the Mean of Madison Cookies– = 0.01667
• Find the Mean of Sophie Electric– = 0.03167

5(b) Sigma (σ) is estimated using sample Standard Deviation (S) for small samples

• Find the Standard Deviation for S&P500 – = 0.03615

• Find the Standard Deviation for Nikkei – = 0.03251

5(c) Covariance is not available on this calculator

It should be calculated after finding value of Correlation (r) in the next section 5(d)

= (-0.8964) * 0.03615 *0.03251 = -0.001053

5(d) Correlation Coefficient: = -0.8964

5(e) E(Rport) = (0.5)(0.01667) + (0.5)(0.03167) = 0.02417

E(ϭport) = √(0.5)2 (0.03615)2 + (0.5)2 (0.03251)2 + 2(0.5)(0.5)(0.03615)(0.03251)(−0.8964)

= 0.00795