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Business, 27.07.2021 01:00 jjgurl60

How are returns on common stocks in overseas markets related to returns in U. S. markets? Consider measuring U. S. returns by the annual rate of return on the Standard & Poor’s 500 stock index and overseas returns by the annual rate of return on the Morgan Stanley Europe, Australasia, Far East (EAFE) index.19 Both are recorded in percents. We will regress the EAFE returns on the S&P 500 returns for the years 1993 to 2012. Here is part of the Minitab output for this regression:

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