Estimate and compares the returns and variability (i.e. annual standard deviation over the past five years) of Reynolds and Hasbro with that of the S&P 500 Index.

Questions1.Estimate and compares the returns and variability (i.e. annual standard deviation over the past five years) of Reynolds and Hasbro with that of the S&P 500 Index. Which stock appears to be riskiest? 2.Suppose Sharpe’s position had been 99% of equity funds invested in the S&P 500 and either 1% in Reynolds or 1% in Hasbro. Estimate the resulting portfolio position. How does each stock affect the variability of the equity investment? How does this relate to your answer in question 1 above? 3.Perform a regression of each stock’s monthly returns on the Index returns to compute a “Beta” for each stock. How does this relate to your answer in question 2 above? 4.How might the expected return of each stock relate to its riskiness? 5.In what stock(s) (if any) should Sharpe invest? 6. Set a spreadsheet based on the uploaded Excel.