Creating E.F using real data using excel

Overview

Creating E.F using real data

Steps

Step 1: Choose 3 stocks (in saudi exchange)

(3 Risky assets: Bond, oil, Gold, Commodity, FX, Crypto …)

Step 2: Collect Historical Data

2 years (≈ 500 obs.)

Data: daily → Prices

Calculate daily returns:

R_{i,t+1} = \frac{(P_{t+1} - P_t) + D_{t+1}}{P_t}

Compute \( E(R) \) and \( \sigma^2(R) \) for each stock (Asset)