Exercises
Mix and Match
Match the concept described in words in the left column with the correct symbols or notation in the right column.
| 1. Consequence of positive covariance | (a) p(x, y) |
| 2. Covariance between X and Y | (b) ρ |
| 3. Property of uncorrelated random variables | (c) p(x, y) = p(x)p(y) |
| 4. Weighted sum of two random variables | (d) ρσxσy |
| 5. Sharpe ratio of a random variable | (e) Var(X + Y) > Var(X) + Var(Y) |
| 6. Implies X and Y are independent random variables | (f) p(x) = p(y) |
| 7. Implies X and Y are identically distributed | (g) X1, X2, X3 |
| 8. Symbol for the correlation between random variables | (h) Var(X + Y) = Var(X) + Var(Y) |
| 9. Symbol for a joint probability distribution | (i) S(Y) |
| 10. Sequence of iid random variables | (j) 3X |
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