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  3. d. assuming that the expected yen return on the ni

d. Assuming that the expected yen return on the Nikkei 225 index is 5%, and...

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Finance

d. Assuming that the expected yen return on the Nikkei 225 index is 5%, and its volatility is 18%, and the volatility of the euro/yen exchange rate is 9%, what is the volatility of the euro return on the Nikkei 225 index if the correlation between the Nikkei indexs return in yen and changes in the euro/yen exchange rate is 0.15? (3 marks)

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