Excel tutorial: calculating covariance and correlation of stock returns

Discusses how to download two companies' stock returns from Yahoo Finance, and calculate (a) the variance and standard deviation of each stock, and (b) the covariance and correlation of the returns of both stocks.
Some good books on Excel and Finance:
Financial Modeling - by Benninga:
amzn.to/2tByGQ2
Principles of Finance with Excel - by Benninga:
amzn.to/2uaCyo6

[@abdisamichirsi1638]

HI THERE, I WAS ACTUALLY WORRIED ABOUT A PROECT OF THE SAME BUT AFTER WATCHING YOUR VIDEO I MUST CONFESS IT IS MORE THAN USEFULL AND AM GLAD. THANK YOU SIR. KEEP THE GOOD WORK

[@antonioromero878]

This popped up randomly on my youtube recommended and I have no regrets.

[@KerouacsAccomplice]

they're listening lol

[@terrysedmak7298]

Excellent demonstration of calculating covariance and correlation of stocks. I'm working on something right now and this was very helpful. Keep the tutorials coming, they do help us.

[@JayHennigan]

You have saved me a world of pain. I leaned a lot, thank you!

[@NircAgis]

Yoooo, youre a life saver man. Haha. Now i dont have to manually go thru all operations and just use the function.

[@pojungchiang5956]

Shouldn't you be calculating the "sample" variance and covariance since you selected a specific return period?

[@sandraarmanious4913]

is it possible to leave the last price for the last date? won't it make a difference in the variance and the correlation?

[@leharjain6718]

Hello sir, nice lecture.
Just wanted to understand, why we have done minus 1 while calculating daily returns

[@jaygandhi778]

can we find covariance for 3 companies??

[@soeralecha]

Thank you for simplifying this

[@arinayahya8884]

hi sir, whats the difference of using the formula var and varp?

[@merjenorazmammedova6516]

Thank you so much for the video!

[@gauravmohan9271]

thank you so much brother. keep growing

[@ajayjcd]

hello sir,thanks for your sharing,have you had shared further videos on fundamental analysis, i mean how to take marrket return=rm,and risk free rate and beta to apply capm formula for identifying the intrinsic value of a stock?

[@xj1471]

looking at those stock prices in 2021 makes me cry

[@JenJen-sf5hg]

Hi Why are you using straight ave instead of geo ave? I thought we were supposed to use geo ave for this purpose. Thank you!

[@dbsk06]

so helpful - can you provide the excels for downlaod so we can do this along with you ? think that would help with subscribers

[@manishathakur2628]

Thank you sir.. it was really helpful.

[@assematalla8740]

Will the covariance change if we replace array 1 with 2?how do i know which one is first?

[@dheerajkhetan4461]

Wonderful, an eye opener

[@scottjeffery7297]

Outstanding presentation!!!! Thank you.

[@jessicanav6064]

Very helpful and clear explanation! Thanks.

[@bigjayfitness]

your a boss broski - you always remember that.

[@manishathakur2628]

What if we have to compare 3 companies?

[@muhammadumarnazirchishti5155]

KINDLY WILL YOU PLEASE APPLY MERTON MODEL ON THESE ....

[@dollybegum9146]

Can you please let me know that, how to find the adjusted closing price if it's not given in the website?

[@jamesdgrafton]

Subtract any dividends from the closing price. Adjusted closing is accounting for dividends.

[@SIDESHOW467]

This is EXACTLY what I needed help with.

[@Hobbytopassion_ManishJain]

Having done so far, what next to enter into the pair trade?

[@ladakhdiaries..3577]

how did u put square in that diff- squad...?

[@arwaalzaeem1157]

you are the BEST

[@surbhikumari7401]

Thanks, it is really helpful.

[@jerrylewis4157]

i just cant wrap my head around that variance calculation. still dont understand what it really symbolises.

[@LM-he7eb]

HOW SPREAD OT THE OBSERVATION ARE FROM THE MEAN

[@seemasingh-vf7py]

but correlation is supposed to be between -1 and +1. please explain this 40% correlation

[@youtubeuser2195]

40% = 0.4

[@ic3432]

Hi! Is there a way to do the same thing in R studio instead of excel? thanks!

[@prashanperera9154]

legend bro !
thank you !

[@crni5]

How can one calculate Pearsons correlation between a prior year value with current year value?

[@JfTalbot23]

Hi do you offer 1 on 1 tutoring?

[@richardgordon]

Brilliant! Many thanks. Much appreicated!

[@27naysen._.]

frr merci d'avoir aidé young fresne, c qui young fresne ? hey les gars vous le connaissez ? bref merci beaucoup il comprenait rien mais grace a vous il va avoir la moyenne cimer le reuf....

[@sisilvarghese5240]

That Was Very helpful, Thanks !!!

[@jessinvests]

You're amazing, great help. Thank you so much!

[@danielg5085]

Excellent video. However the presenter is wrong when he says that he calculates the returns for the entire year. He excludes January - that's why there are only 11 monthly return cells

[@himanshumahajan9882]

The importance here isn't in the WHAT but HOW he calculated the coVAR and coREL using the formulas. You can make your own table and try it out

[@Unknown-km1pt]

Thankyou very much sir

[@menisa4869]

what the difference using this calculate return and using ln

[@abebeendale554]

IS VERY HELPFUL

[@swetapatra]

But how can we make correlation a percentage number

[@varshabaskaran438]

when rs 100 is invested how to do that from returns

[@fransiska2501]

Thank you so much

[@alexnhim0421]

Thanks for this upload.

[@shadmankhan1969]

THANK YOU SO MUCH

[@stanko4333]

what kind of a formula for return is that man. Shouldnt you calculate it with HPR so (new price - old price) / old price

[@0069yj]

What Covariance use for?

[@The-Innovators.]

great .....thanks its really helpful

[@Unsanskarinaari]

Extremly helpful👏

[@sulochanavijerathna9600]

Thanks

[@themahliman8984]

Thanks Codible!

[@erickim2037]

why minuse 1

[@caribbeanqueen1389]

Thanks dude!

[@supremecooler]

Thank you

[@VAPOURprod]

thank you !

[@DanishSiddiquidelhi]

awesome...

[@paulagro9914]

MERCII OMG

[@battery0631]

awesome

[@claudiodibernardino8327]

bravo!!!

[@bohu5805]

awsome ~

[@mohamadasyraf4724]

You fucking legend I love you

[@alexiqbal3578]

Legend.

[@investwithvincent6329]

you left out how to calculate covariance manually

[@ahmedmo5358]

Hello Everyone, I want to know more the this is anyone out there who can teach me on how to calculate the indexes and its associated constituents. Please help me!

[@MosesTheExplorer]

Thanks :D

[@tanmaythakur6172]

bhau tuch bhari mard ahes tu mard

[@KhoaTran-le1ot]

Thank you for sharing this !!