Holding-period returns, two kinds of average and a standard deviation, built from supplied prices for two composite stocks, fill the MT422 return and risk calculation for Unit 2. Searches like "mt 422 unit 2 assignment example", "mt422 unit 2 sample" and "mt422 unit 2 example" land here.
What a finished MT422 Unit 2 return and risk calculation looks like
Four pages, the first holding the price table exactly as supplied. The RV maker's year-end prices run from 38.50 to 52.02 with dividends between 0.24 and 0.40; the dollar-store chain's run from 64.20 to 91.09 with dividends rising from 1.10 to 1.40. Each year's holding-period return adds the dividend to the price change and divides by the starting price, giving the RV maker 33.01, minus 21.00, 39.00, 5.01, minus 26.99 and 25.99 percent. Its arithmetic mean is 9.17 percent against the chain's 8.50, and its sample standard deviation 28.20 against 14.45. Compound growth reverses the order: 5.90 percent a year for the RV maker, 7.66 for the chain, or 41.08 and 55.74 percent over the six years.
How a MT422 Unit 2 example is structured
The calculation runs in the order its figures depend on each other, and nothing is reported before its inputs appear. Year one for the RV maker is worked in full, price change plus dividend over the opening price, and the other eleven returns sit in a table built the same way. Averages follow, arithmetic first and then geometric, computed by multiplying one plus each return, taking the sixth root and subtracting one. Variance uses the sample formula, dividing by five, and the population figure of 25.74 percent is noted once so the choice is visible. Its last section accounts for the reversal between the two stocks: large swings in both directions pull compound growth below the simple average, and the gap between the two measures, 3.27 points for the RV maker and 0.84 for the chain, widens with volatility.
Prices and dividends as supplied
Seven year-end prices and six payments per stock, reproduced before any arithmetic so nothing in the table can be mistaken for an adjustment.
One return worked in full
The RV maker's first year, 50.81 minus 38.50 plus a 0.40 dividend over 38.50, gives 33.01 percent and sets the pattern for the rest.
Averages that disagree
An arithmetic 9.17 against 8.50 favors the RV maker; compound rates of 5.90 and 7.66 favor the chain, and both results are kept in view.
Dispersion from six observations
Sample deviations of 28.20 and 14.45 percent, with a note that six annual points give a rough estimate at best and nothing firmer.
Why volatility costs growth
A 39 percent gain followed by a 27 percent loss leaves barely more than the starting value, which is why the gap tracks the size of the swings.
Where marks go in MT422 Unit 2
A holding-period return divided by the ending price instead of the opening one is a quiet error that shifts every figure after it, and graders tend to catch it in year one. Dividends omitted cost the chain most, since payments of 7.50 supplied over a fifth of its gain. Annualizing the six-year return by dividing 55.74 by six, rather than taking a root, overstates compound growth and draws comment. Reporting only the arithmetic mean hides the reversal the set was built to show, and naming the RV maker the better investment on that figure misreads it. Deviations presented to two decimals with no caution about six observations suggest more precision than the data hold. A table without a worked example leaves partial credit nowhere to land when one return is wrong.
Get a MT422 Unit 2 example written to your instructions
Price data from the Unit 2 prompt, or tickers and dates if the section asks for real series, are enough to start. The free first MT422 calculation arrives in 24-48h with every return, mean and deviation shown in the order the rubric expects, worked in Excel or by hand as instructed, with any data source cited.
MT422 Unit 2 questions, answered
Should the geometric or the arithmetic mean be reported?
Both, with a sentence on what each answers. The arithmetic mean estimates a typical single year and feeds later expected-return work; the geometric mean describes what the money actually compounded to. When they differ sharply, as they do for a volatile stock, that difference is worth a sentence, because it shows volatility costing growth.
Do I use sample or population standard deviation?
Historical returns are almost always treated as a sample, so dividing by one fewer than the number of observations is the usual choice. Some instructors accept either if it is named. What costs marks is switching between them or leaving the reader to guess, so state the formula once and keep it throughout.
Can Excel functions replace the worked formulas?
Usually, provided the function is named and at least one result is shown by hand, so a grader can see the method as well as the output. STDEV.S and STDEV.P give different answers on the same data, which is exactly the kind of difference a short note beside the table should explain.