Investment objective and risk profile
1. Define your investment objective and risk profile
2. Select 20 stocks traded on a US exchange and acquire a history of daily stock prices
Include:
2.1.A short (no more than one page) narrative as to how you decided upon your stock
selections
2.2.For each stock, a graph showing the daily growth of $10,000 invested on 08/31/2011
through 08/31/2021
2.3.For each stock, a table showing the Compound Annual Growth Rate for the following
time periods:
2.3.1. The 10-year period from 08/31/2011 – 08/31/2021
2.3.2. The 5-year period from 08/31/2016 – 08/31/2021
2.3.3. The 3-year period from 08/31/2018 – 08/31/2021
2.3.4. The 1-year period from 08/31/2020 – 08/31/2021
2.4.For the 20 stocks, a correlation matrix of the stocks’ adjusted returns over the 10-year
period 08/31/2011 through 08/31/2021
3. Construct a portfolio of the 20 stocks with appropriate weights to meet your investment
objective. Include:
3.1.A short (no more than one page) narrative as to the objectives of your portfolio and the
choice of the index that you will compare the performance to.
3.2.The description of how you decided on the weights to give each stock.
3.3.For the portfolio, a graph showing the growth of $10,000 invested on 08/31/2011
through 08/31/2021 compared to the selected index
3.4.A table showing the % weights to each of the stocks at 08/31/2011
3.4.1. Each stock must have at least 2% allocation and no more than 10% allocation
3.5.For the portfolio, a table showing the Compound Annual Growth Rate for the following
time periods:
3.5.1. The 10-year period from 08/31/2011 – 08/31/2021
3.5.2. The 5-year period from 08/31/2016 – 08/31/2021
3.5.3. The 3-year period from 08/31/2018 – 08/31/2021
3.5.4. The 1-year period from 08/31/2020 – 08/31/2021
3.6.A table showing the following statistics
3.6.1. Mean Annual Return
3.6.2. Standard Deviation
3.6.3. R Squared
3.6.4. Sharpe Ratio