Question
Please show all work legibly for rating. Consider the following collection of n = 9 closing...
Please show all work legibly for rating.
Consider the following collection of n = 9 closing prices for stock
ABC: 101.02, 102.23, 100.34, 99.87, 98.65, 96.45, 98.45, 99.00, 100.05
Compute the standard estimator of the volatility parameter σ using these closing prices.
Homework Answers
Answer #1
we have to find population standard deviation for the volatility
mean = (sum of all closing prices)/(total number of closing prices)
= (101.02+102.23+100.34+99.87+98.65+96.45+98.45+99.00+100.05)/9
= 896.06/9
= 99.562 = 
Population standard deviation = 
so, required standard estimator of the volatility parameter σ is 1.57 (2 decimals)
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