Financial Analysis Homework: Regression, CAPM, and Variance Analysis

This finance homework assignment addresses key concepts in quantitative finance, including the algebraic formula for contract execution (S), calculation of expected daily executed contracts E(s) and variance Var(s), and probability distributions. It then delves into unconditional and conditional mean and variance calculations, providing formulas and explanations. The assignment also includes a regression analysis section, presenting and interpreting summary output, including ANOVA, coefficients, and p-values. The analysis involves a regression model with multiple variables, and the student is tasked with interpreting the results, including the random pattern and the null hypothesis testing for the coefficients. The student also addresses autocorrelation and ARCH effects, along with the CAPM test and its validity based on the output. The document provides a comprehensive breakdown of the financial concepts and their practical application.