## Assignment 2

BUSI 721

Data Driven Finance I

Jones Graduate School of Business

Rice University

Submit a Jupyter notebook. Copy each question into a Markdown cell and provide your answer in the cell or cells below it.

- Using Yahoo Finance, calculate daily, monthly, and annual returns for CVX over the five-year period Jan 1, 2018 through Dec 31, 2021. Plot the returns. Note: you should use start=“2016-12-30” and end=“2021-12-31” in the pandas datareader. Also, for plotting it is better not to convert the index to the period format.
- Create box plots for the three sets of returns.
- What was the geometric average annual return for CVX over the five-year period?
- Draw 1,000 sets of 30 normally distributed random variables with a mean of 6% and a standard deviation of 10%. Viewing the variables as annual returns, compound them over each 30-year period to obtain 1,000 accumulations \((1+r_1) \cdots (1+r_{30})\). Create a box plot of the 1,000 accumulations. Execute np.random.seed(0) before generating the random variables.