Chartered Financial Analyst Level 1

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An analyst develops the following joint probability function for the returns of two companies, X and Y:

Return of Y \ Return of X 20% 15% 10%
15% 0.2 0 0
10% 0 0.4 0
5% 0 0 0.4

The expected returns for companies X and Y are 14% and 9%, respectively. The covariance of returns between X and Y (in percent squared) is closest to:

Return of Y \ Return of X	20%	15%	10%
15%	0.2	0	0
10%	0	0.4	0
5%	0	0	0.4

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