State of the Economy Probability of Occurrence Recession Average Boom 35% O 0.26 O 0.96 O 0.51 O 0.26 45% 20% What is the correlation between stocks X and Z? Stock X Expected Return 25% 14% 4% Stock Y Expected Return -10% 8% 14% Stock Z Expected Return 15% 25% -10%

MATLAB: An Introduction with Applications
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Author:Amos Gilat
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State of the Economy
Recession
Average
Boom
Probability of Occurrence
O 0.26
O 0.96
O 0.51
O 0.26
35%
45%
20%
What is the correlation between stocks X and Z?
Stock X
Expected Return
25%
14%
4%
Stock Y
Expected Return
-10%
8%
14%
Stock Z
Expected Return
15%
25%
-10%
Transcribed Image Text:State of the Economy Recession Average Boom Probability of Occurrence O 0.26 O 0.96 O 0.51 O 0.26 35% 45% 20% What is the correlation between stocks X and Z? Stock X Expected Return 25% 14% 4% Stock Y Expected Return -10% 8% 14% Stock Z Expected Return 15% 25% -10%
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