Question
Calculate returns, average return, risk, and the risk adjusted return for each stock. Describe which one you would choose to invest in and explain why.
Calculate returns, average return, risk, and the risk adjusted return for each stock. Describe which one you would choose to invest in and explain why. Are there portfolio diversification possibilities? That is, is it better to invest simultaneously in both stocks or not? What is the potential percentage gain of the portfolio diversification? Which method results in finding a portfolio that will lead to the higher risk adjusted return? Structure your report in terms of sections such as 1. Introduction, 2. Background information for each stock market, 3. Methods and data discerption, 4. Estimation results and analysis, 5. Conclusions. References should be presented at the end of the report. Name and student ID number for each author should be clearly indicated. Make sure that you select an appropriate title for your project. Be original and use your own words. If you use any other literature as a source, make sure that you reword the content in addition to appropriate citation. Feel welcome to contact my any time you have questions. Estimate the value at risk (VaR) for each portfolio at the 99% significance level.
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