Expected Return Calculator
 State  Probability Stock 1 Stock 2
1 % % %
2 % % %
3 % % %
4 % % %
5 % % %

Expected Return: % %
Variance:
Standard Deviation: % %
Covariance:
Correlation:

 

The Expected Return Calculator calculates the Expected Return, Variance, Standard Deviation, Covariance, and Correlation Coefficient for a probability distribution of asset returns.

1.     Input Fields - Enter the Probability, Return on Stock 1, and Return on Stock2 for each state in these fields. The sum of the probabilities must equal 100%.

2.     Expected Return Fields - The Expected Returns on Stocks 1 and 2 are displayed here.

3.     Variance Fields - The Variance of the returns on Stocks 1 and 2 are displayed here.

4.     Standard Deviation Fields - The Standard Deviation of the returns on Stocks 1 and 2 are displayed here.

5.     Covariance Field - The Covariance between the returns on Stocks 1 and 2 is displayed here.

6.     Correlation Coefficient Field - The Correlation Coefficient between the returns on Stocks 1 and 2 is displayed here.

7.     Buttons - Press the Calculate Button to calculate the Expected Return, Variance, etc. for Assets 1 and 2. Press the Clear Button to reset the calculator.

Expected Return:

E[R]=\sum _{{i=1}}^{{n}}R_{{i}}P_{{i}}

where Ri is the rate of return achieved at ith outcome, pi is the probability of ith outcome, and n is the number of possible outcomes

Standard Deviation:

Standard deviation of return formula

 where ri is the rate of return achieved at ith outcome, ERR is the expected rate of return, pi is the probability of ith outcome, and n is the number of possible outcomes

copy right 2002 - 2019 by Mark A. Lane, Ph.D.
http://www.zenwealth.com/BusinessFinanceOnline/RR/ERCalculator.html