Exercise

# The co-variance matrix

You can easily compute the **co-variance matrix** of a DataFrame of returns using the `.cov()`

method.

The correlation matrix doesn't really tell you anything about the variance of the underlying assets, only the linear relationships between assets. The co-variance (a.k.a. variance-covariance) matrix, on the other hand, contains all of this information, and is very useful for portfolio optimization and risk management purposes.

Instructions

**100 XP**

- Calculate the co-variance matrix of the
`StockReturns`

DataFrame. - Annualize the co-variance matrix by multiplying it with 252, the number of trading days in a year.