I'm doing a Risk Management exercise on Excel and I need help, I'm lost. I'm analysing a company's portfolio divided into different tabs. In one of the tabs, called "Pool PD", there is a table similar to this (I'm only showing the first 10 months out of the 57 to give an example):
|Month ending||Total||Current||1-30 days||31-60 days||61-90 days||91-120 days||121-150 days||151-180 days||Over 180 days||Default Ratio|
The last column, Default Ratio, they already give me the values by calculating
(91-120 days column) / (Total column) for each row, so naturally all Default Ratios are 0.00%, except for July 96, which is 0.01%.
The exercise asks me to calculate:
- Average Default Ratio (PD) - I did the average of all Default Ratios;
- STDEV - I'm guessing I need to calculate the Standard Deviation of all Default Ratios, which I did as well;
- Annualized PD;
- Annualized STDEV.
Number 3 and 4 I don't know what formulas to use. I read some articles but I don't know which ones to apply to this case.
Any help would be appreciated, thank you!