I need help getting started on this question: A friend has asked you to analyze his stock portfolio, which consists of 10 shares of stock D and 5 shares of stock C. The probability distribution of the stock prices is shown below. Stock D price $40$50$60$70 Stock C price$450.000.000.050.200.25$500.050.000.050.100.20$550.100.050.000.050.20$600.200.100.050.000.35 0.350.150.150.351.00For each of the stocks compute the expected values and variance of one share. Also compute their covariance.Compute the expected value and variance of the portfolio.

Given that C|D 40 50 60 70 total 45 0.00 0.00 0.05 0.20 0.25 50 0.05 0.00 0.05 0.10 0.20 55…

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MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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I need help getting started on this question:

A friend has asked you to analyze his stock portfolio, which consists of 10 shares of stock D and 5 shares of stock C. The probability distribution of the stock prices is shown below.

		Stock D price
		$40	$50	$60	$70
Stock C price	$45	0.00	0.00	0.05	0.20	0.25
$50	0.05	0.00	0.05	0.10	0.20
$55	0.10	0.05	0.00	0.05	0.20
$60	0.20	0.10	0.05	0.00	0.35
		0.35	0.15	0.15	0.35	1.00

For each of the stocks compute the expected values and variance of one share. Also compute their covariance.
Compute the expected value and variance of the portfolio.

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