Note that share price data is available from Yahoo Finance

Carry out a risk and return analysis of 20 stocks taken at random from the FTSE 100 and analyse as follows:

Construct a risk and return profile of each of the twenty stocks over the last 5 years based on monthly observations

Evaluate your results and recommend stocks for a prospective investor who is:

Risk Averse: Investor would like to invest in Low risk stocks. So, identify which stocks are low risks among your selected 20 stocks.

Risk Aggressive: Investor would like to invest in High risk stocks. So, identify which stocks are High risks among your selected 20 stocks.

Note: The criterion for identifying stock as low risk or high risk is AVERAGE STANDARD DEVIATION of all stocks. In Question 1.a. you will calculate individual standard deviation; you can take Average of these all-standard deviations. The assumption here is that you equally invest all 20 stocks.

DATA: you need to download 5 years of monthly share prices data for the 20 stocks from the FTSE 100 using Yahoo Finance.

- Calculate Risk (standard deviations) and return (simple returns OR log returns) of these individual stocks and present your answers

Construct Portfolio by combining the stocks you categorised as low risk and high risk.

Calculate Portfolio risk & return- You need to use mean-variance analysis approach based on historical prices and return. Whereas, for return calculation you can use simple return or log return method, either is fine.