(Does Microsoft stock price really follow a lognormal distribution?) In finance literature, one popular model for stock price is the lognormal distribution. Suppose that we have the daily stock price of a stock, say S1, S2,...., Sn We can then compute the so-called log-return of the stock price R, R2…..,.Rn-1;where R1 = ln(Sn-1)/ni, Si=1,...n-1.
On Canvas, there is a dataset "MSFT_stock_2021.csv" that contains the daily stock price of Microsoft from March 131986 to December 17 2021, with n=9017.