Question

Wirh the following price and dividend information, calculate the sample variance for the returns. (Round to 4 decimals)

Year	Price	Dividend
0	49.72
1	53.54	1.00
2	59.22	1.10
3	51.3	1.20
4	53.45	1.30
5	56.35	1.40

Answer 1

Variance

0.9003%

Year	Price	Dividend	Return=(Dividend+P1-P0)/P0	(X-Average)^2
0	49.72
1	53.54	1	9.69%	0.00206
2	59.22	1.1	12.66%	0.005636
3	51.3	1.2	-11.35%	0.027237
4	53.45	1.3	6.73%	0.000246
5	56.35	1.4	8.04%	0.000835
		Average	5.1560%
		Total		0.036013

Variance = Total (X-Average)^2 / (n-1) = 0.036013/(5-1) =

0.9003%