Mr. Morris had $100,000 in his account. Using this fund, he made a portfolio of two NYSE listed stocks on 01 Jan 2019 in the ratio of 60:40, i.e. 60% funds in Stock 1 & 40% funds in Stock 2. If you would Morris, which two stocks would you choose and why? (APPLE ) AND BERKSHIRE HATHWAY

Calculate and analyze the following by downloading data for these two chosen stocks.

The daily stock data of both stocks can be found on market websites such as finance.yahoo.com. Download daily data for 1 year from 1 Jan 2019 31st Dec 2021.

Using the stock data of the two stocks, you are required to explain the below concepts and then compute for the given stocks:

a. Average return of both the chosen stocks (5 marks)

b. Annualized standard deviation of returns of both the chosen stocks (5 marks)

c. Correlation coefficient of returns of the two chosen stocks. What does this correlation coefficient signify about the correlation of the two stocks and corresponding decision from an investor? (5 marks)

d. Portfolio return of the portfolio of two stocks. (5 marks)

e. Portfolio risk (standard deviation) of the portfolio of two stocks. (5 marks)

f. Critically analyze your investment decision in these two companies (5 Marks).

Given an option, would you like to invest in any other company? Or would you like to have a different ratio of investment in the two? (10 marks)