Go to a site like finance.yahoo.com or a similar site and download 5 years of monthly closing prices for 5 of the above companies (Historical Data). Download the data into an Excel file, and use the Adjusted-Close prices, which adjust for dividend payments.
Answer the following on the Excel file:
Calculate the monthly rate of return for each price series. Use the full range of available data.
Using the Excel functions, calculate the sample standard deviation (STDEV.S) for each firm.
Using Excel’s correlation function, construct the correlation matrix for the 5 stocks based on their monthly returns for the entire period.
What are the lowest and the highest individual pairs of correlation coefficients?
