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# Portfolio Management/Analysis

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Based an the attached, provide the following:

Report:
o Policy statement
o Economic Analysis
o Sector Analysis
o Selection of industry within sectors
o Selection of investments - buy investments by dating the purchase a year back so that you have more than 6 weeks market data to work with. You are not required to have a profitable portfolio - that is not part of the exercise.
 Addressing risk, diversification, global investing, return expectations
o Selection of index
o Behavior
 What has happened to this investment over the last year in relation to news about it? Also discuss the current status of the 50-day/200-day moving average and what it means.
o Results
 Individual/portfolio expected vs. actual annual returns, index vs. portfolio performance
 Evaluation of portfolio management (at least one method)

#### Solution Preview

1. Not sure about the current status of the 50-day/200-day moving average as data is missing. The ...

#### Solution Summary

An example of an investment portfolio analysis, including the Investment Policy Statement, Economic Analysis, Sector Analysis, Expected Return, Investment Horizon, Risk identification, diversification, Global investing, Return expectations, technical analysis, Performance evaluation

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## Calculate Returns & Variability. Risk Premiums, Expected Returns, Standard Deviations

9. Calculating Returns and Variability You've observed the following returns on Mary Ann Data Corporation's stock over the past five years: 216 percent, 21 percent, 4 percent, 16 percent, and 19 percent.
a. What was the arithmetic average return on Mary Ann's stock over this five-year period?
b. What was the variance of Mary Ann's returns over this period? The standard deviation?
10. Calculating Real Returns and Risk Premiums In Problem 9, suppose the average inflation rate over this period was 4.2 percent and the average T-bill rate over the period was 5.1 percent.
a. What was the average real return on Mary Ann's stock?
b. What was the average nominal risk premium on Mary Ann's stock?
5. Calculating Expected Return Based on the following information, calculate the expected return:

6. Calculating Returns and Standard Deviations Based on the following information, calculate the expected return and standard deviation for the two stocks:

Discuss an overview of the measures of returns on various financial assets, and the various measures of the risk associated with the same assets. Develop the concept of portfolio and provide measures of portfolio risk and return. Analyze beta as a measure of relative risk of the stock and the impact of diversification on measuring risk.
Discuss the applications of portfolio theory, the concept of time value of money on financial management analysis.

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