Please do not post any old answers! Please read my instructions carefully. Pleas
ID: 2741011 • Letter: P
Question
Please do not post any old answers! Please read my instructions carefully.
Please only complete the Causitive factors chart based on the data I will provide in this question. I have already gained data on DJIA, NASDAQ and 10 year t yield.
The Causative Factors and Forces Impacting Stock and Bond Markets
You report will analyze the following:
The impact of the various causative factors on the three indicator values.
List each of the causative factors in bulleted form (See the chart provided for this information). For each factor, briefly analyze the nature (positive or negative) and degree (severity) of the impact on each of the three indicators. You must analyze why stocks and bonds values increase or decrease. You may see the “Credit Markets” section of Section C of the WSJ for causative factors of the bond markets. Also see pages C1 and C2 of the WSJ for other causative factors for the DJIA and NASDAQ. The following is the data that should be used for the causitive factors.
he relationship between the three values.
Describe the relationship you find between each of the indicator values. Be sure to compare each with the other two. Calculate the correlation coefficient between:
The DJIA and NASDAQ index
DJIA and the 10-Yr T-Note Yield
NASDAQ and the 10-Yr T-Note Yield
Present this information in the table provided. Finally, interpret the coefficients and provide an analysis of the coefficient values.
Your learnings from your observations. This data should also be presented in bulleted form in the data.
Closing data for DJIA for the period 31st May to 1st July 2016
30-Jun-16
Closing data for NASDAQ for the period 31st May to 1st July 2016
4,948.05
Closing 10 yr T note yeild 31st may to 1st july 2016
Date
Causative Factors
4/12/10
Oil price reduces by $1.00 per barrel as OPEC is faces over-production.
The Fed reduces discount rate from 2.50% to 2% as inflation fear subsides.
Etc….
** Note: The above is provided as an example. Be specific and concrete about the causative factor:
How much was the increase (or decrease)? From what level to what level?
Provide information about the magnitude of change makes the statement concrete
Bullet the information for each day
Correlation Matrix
DJIA
NASDAQ
T-Note Y
DJIA
NASDAQ
-
T-Note Y
-
-
I have provided the chart of the data that should be used to complete the parts of the causitive factors.
Date DJIA % change 31-May-16 17,787.20 0.01% 1-Jun-16 17,789.67 0.27% 2-Jun-16 17,838.56 -0.18% 3-Jun-16 17,807.06 0.64% 6-Jun-16 17,920.33 0.10% 7-Jun-16 17,938.28 0.37% 8-Jun-16 18,005.05 -0.11% 9-Jun-16 17,985.19 -0.67% 10-Jun-16 17,865.34 -0.74% 13-Jun-16 17,732.48 -0.33% 14-Jun-16 17,674.82 -0.20% 15-Jun-16 17,640.17 0.53% 16-Jun-16 17,733.10 -0.33% 17-Jun-16 17,675.16 0.73% 20-Jun-16 17,804.87 0.14% 21-Jun-16 17,829.73 -0.27% 22-Jun-16 17,780.83 1.29% 23-Jun-16 18,011.07 -3.39% 24-Jun-16 17,400.75 -1.50% 27-Jun-16 17,140.24 1.57% 28-Jun-16 17,409.72 1.64% 29-Jun-16 17,694.68 1.33%30-Jun-16
17,929.99 0.11% 1-Jul-16 17,949.37Explanation / Answer
I don't understand i have already answered the quesion. Please refer the solution.
You will get a table in excel, now put the desired formula for correlation as it can be got to and in the table the mean of the changes, as given from the period.
Chart is Made using excel for the same Use formula's as provided by me and then use correlation formula substitute the values and results can be arrived at.
Correlation coefficients Date DJIA NASDAQ 10 year Note Yeild DJIA^2 NASDAQ^2 10 year Note Yeild^2 DJIA* NASDAQ NASDAQ*10 year bond DJIA*10 year bond 31-May-16 17,787.20 4,948.05 0.02 316384484 24483198.8 0.0004 88011954.96 98.961 355.744 1-Jun-16 17,789.67 4,952.25 0.02 316472359 24524780.06 0.0004 88098893.26 99.045 355.7934 2-Jun-16 17,838.56 4,971.36 0.02 318214223 24714420.25 0.0004 88681903.64 99.4272 356.7712 3-Jun-16 17,807.06 4,942.52 0.02 317091386 24428503.95 0.0004 88011750.19 98.8504 356.1412 6-Jun-16 17,920.33 4,968.71 0.02 321138227 24688079.06 0.0004 89040922.87 99.3742 358.4066 7-Jun-16 17,938.28 4,961.75 0.02 321781889 24618963.06 0.0004 89005260.79 99.235 358.7656 8-Jun-16 18,005.05 4,974.64 0.02 324181826 24747043.13 0.0004 89568641.93 99.4928 360.101 9-Jun-16 17,985.19 4,958.62 0.02 323467059 24587912.3 0.0004 89181722.84 99.1724 359.7038 10-Jun-16 17,865.34 4,894.55 0.02 319170373 23956619.7 0.0004 87442799.9 97.891 357.3068 13-Jun-16 17,732.48 4,848.44 0.02 314440847 23507370.43 0.0004 85974865.33 96.9688 354.6496 14-Jun-16 17,674.82 4,843.55 0.02 312399262 23459976.6 0.0004 85608874.41 96.871 353.4964 15-Jun-16 17,640.17 4,834.93 0.02 311175598 23376548.1 0.0004 85288987.14 96.6986 352.8034 16-Jun-16 17,733.10 4,844.91 0.02 314462836 23473152.91 0.0004 85915273.52 96.8982 354.662 17-Jun-16 17,675.16 4,800.34 0.02 312411281 23043264.12 0.0004 84846777.55 96.0068 353.5032 20-Jun-16 17,804.87 4,837.21 0.02 317013396 23398600.58 0.0004 86125895.21 96.7442 356.0974 21-Jun-16 17,829.73 4,843.76 0.02 317899272 23462010.94 0.0004 86362932.98 96.8752 356.5946 22-Jun-16 17,780.83 4,833.32 0.02 316157915 23360982.22 0.0004 85940441.26 96.6664 355.6166 23-Jun-16 18,011.07 4,910.04 0.02 324398643 24108492.8 0.0004 88435074.14 98.2008 360.2214 24-Jun-16 17,400.75 4,707.98 0.02 302786101 22165075.68 0.0004 81922382.99 94.1596 348.015 27-Jun-16 17,140.24 4,594.44 0.01 293787827 21108878.91 0.0001 78749804.27 45.9444 171.4024 28-Jun-16 17,409.72 4,691.87 0.01 303098350 22013644.1 0.0001 81684142.98 46.9187 174.0972 29-Jun-16 17,694.68 4,779.25 0.02 313101700 22841230.56 0.0004 84567299.39 95.585 353.8936 30-Jun-16 17,929.99 4,842.67 0.01 321484541 23451452.73 0.0001 86829024.67 48.4267 179.2999 1-Jul-16 17,949.37 4,862.57 0.01 322179883 23644587 0.0001 87280068.08 48.6257 179.4937 17764.3192 4860.322083 0.018333 7574699278 567164788 0.0084 2072575694 2143.039 7822.58 Average Sum Var DJIA DJIA^2 Average square Var 10 year bond 7259128243 0.008063889 Var NASDAQ NASDAQ^2 543542057 Correlation Matrix Covariance NASDAQ & DJIA NASDAQ & 10 year bond DJIA & 10 year bond 1986235382 2053.933 7496.90082 Particulars DJIA NASDAQ T-Note Y DJIA 0 0.9999353 0.9799 0.99993531 Correlation coefficient for NASDAQ & DJIA NASDAQ 0.9999 0 0.9811 0.98106429 Correlation coefficient for NASDAQ & 10 year bond T-Note Y 0.9799 0.9810643 0 0.9798673 Correlation coefficient for DJIA & 10 year bond