Q.2: a. Write down the procedure for portfolio optimization b. Portfolio Assignment: Date B D 29-Jan-16 261.71 297.93 109.23 29-Feb-16 238.00 292.01 107.05 31-Mar-16 260.04 346.12 114.44 29-Apr-16 260.02 297.60 131.34 31-May-16 254.18 294.18 139.44 30-Jun-16 261.92 281.00 138.07 30-Jul-16 276.22 269.38 136.52 31-Aug-16 277.44 289.65 140.16 30-Sep-16 257.17 335.00 141.23 31-Oct-16 235.12 294.53 140.62 30-Nov-16 269.50 302.84 141.04 30-Dec-16 291.64 375.00 165.35 31-Jan-17 279.98 389.34 160.62 111.15 109.17 106.62 107.21 113.26 114.72 113.68 110.96 103.98 103.77 105.21 104.37 115.80 1. Calculate 12-monthly returns of each stock. 2. Calculate Variance-covariance matrix by three different methods. [matrix-A] 3. Assign equal weights to each stock. (matrix-B] 4. Calculate the monthly average return (arithmetic mean) of each of the stock. [matrix-C) 5. Now you should have three matrices, one with average return, other with weights and third with Variance- covariance 6. Calculate Portfolio return by MMULT excel function. 7. Calculate the portfolio risk by using MMULT and TREANSPOSE function. Q.2: a. Write down the procedure for portfolio optimization b. Portfolio Assignment: Date B D 29-Jan-16 261.71 297.93 109.23 29-Feb-16 238.00 292.01 107.05 31-Mar-16 260.04 346.12 114.44 29-Apr-16 260.02 297.60 131.34 31-May-16 254.18 294.18 139.44 30-Jun-16 261.92 281.00 138.07 30-Jul-16 276.22 269.38 136.52 31-Aug-16 277.44 289.65 140.16 30-Sep-16 257.17 335.00 141.23 31-Oct-16 235.12 294.53 140.62 30-Nov-16 269.50 302.84 141.04 30-Dec-16 291.64 375.00 165.35 31-Jan-17 279.98 389.34 160.62 111.15 109.17 106.62 107.21 113.26 114.72 113.68 110.96 103.98 103.77 105.21 104.37 115.80 1. Calculate 12-monthly returns of each stock. 2. Calculate Variance-covariance matrix by three different methods. [matrix-A] 3. Assign equal weights to each stock. (matrix-B] 4. Calculate the monthly average return (arithmetic mean) of each of the stock. [matrix-C) 5. Now you should have three matrices, one with average return, other with weights and third with Variance- covariance 6. Calculate Portfolio return by MMULT excel function. 7. Calculate the portfolio risk by using MMULT and TREANSPOSE function