What is the formula for Correlation Coefficient?

What is the formula for Correlation Coefficient?

Use the formula (zy)i = (yi – ȳ) / s y and calculate a standardized value for each yi. Add the products from the last step together. Divide the sum from the previous step by n – 1, where n is the total number of points in our set of paired data. The result of all of this is the correlation coefficient r.

How do you calculate portfolio correlation?

The correlation between the two assets is 2.04. To calculate the covariance of the assets, multiply the square root of the variance of Company A's stock by the square root of the variance of Company B's stock. The resulting covariance is 0.50.