Question

Given the returns for two stocks with the following information, calculate the correlation coefficient of the...

Given the returns for two stocks with the following information, calculate the correlation coefficient of the returns for the two stocks. Assume the expected return is 14.4 percent for Stock 1 and 15.9 percent for Stock 2. Do not round intermediate computations.

Prob                Stock 1            Stock 2                        
0.5                   0.11                 0.18
0.3                   0.17                 0.15
0.2                   0.19                 0.12

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