Project 4: Idiosyncratic Variance Matrix - expected output is NULL-matrix?

[jevgenitolstouhhov]

It seems like really suspicious that NULL matrix is expected on output:

EXPECTED OUTPUT FOR idiosyncratic_var_matrix: Equity(0 [A]) Equity(1 [AAL]) Equity(2 [AAP]) Equity(0 [A]) 0.00000000 0.00000000 0.00000000 Equity(1 [AAL]) 0.00000000 0.00000000 0.00000000 Equity(2 [AAP]) 0.00000000 0.00000000 0.00000000

Can you confirm, if this is meant this way?

[e7dud7e]

Hi Jevgeni, you're right that most likely we won't have risk factors perfectly explain the returns, which means that the diagonal of the idiosyncratic matrix would normally have non-zero variances. I think we just picked some sample inputs that would make the idiosyncratic variances zero, to make it easier to test the function. Maybe we should try to clarify that in the notebook.