Sonic Healthcare Limited is part of the ASX200, an Australian stock market index and Chugai Pharmaceutical belonging to the Nikkei 225, the index representing the top 225 companies by market capitalisation on the Tokyo Stock Exchange (TSE)

1.

Download daily (Adjusted Closing) stock prices from yahoo finance from 31 May 2021 to 31 May 2022. For each company, calculate daily stock returns; arithmetic mean of daily returns, geometric mean of daily returns, and the holding period return (HPR). (10 marks) Please note that a company can be listed on a number of stock exchanges. On Yahoo Finance you will see that a listing on the Australian Stock Exchange is represented as Equity.AX, whereas a listing on the Tokyo Stock Exchange is shown as Equity.JPX

Task 2

Calculate and identify which one of the stocks of the two companies is riskier than the other using beta and standard deviation as risk metrics.

Task 3

Using geometric mean return information and the standard deviation metrics calculated above, which company would you invest in if you were a risk-averse investor? Justify your choice.

Task 4

Perform a comparative analysis of how the companies' industries have been affected by the advent of COVID-19.

Task

5 Perform a comparative discussion of standard deviation as a measure of risk with one downside measure of risk. Note that Investopedia and Wikipedia are not authentic scholarly sources for this task and should not be used. You are expected to use information from peer reviewed journal articles.

Note:

	Adjusted Closing	Adjusted Closing
Date	Share Price	Index	Ri	(1+Ri)	Rm	(1 + Rm)
31/12/2019	0.96796	6802.40
2/01/2020	0.93073	6810.00	-0.03846	0.9615	0.0011	1.0011
3/01/2020	1.11688	6855.20	0.20000	1.2000	0.0066	1.0066
6/01/2020	0.96796	6857.40	-0.13334	0.8667	0.0003	1.0003
7/01/2020	0.85628	6943.60	-0.11538	0.8846	0.0126	1.0126
8/01/2020	0.78182	6930.10	-0.08696	0.9130	-0.0019	0.9981
9/01/2020	1.15411	6991.40	0.47618	1.4762	0.0088	1.0088
10/01/2020	1.37749	7041.90	0.19355	1.1936	0.0072	1.0072
13/01/2020	1.19134	7020.20	-0.13514	0.8649	-0.0031	0.9969
14/01/2020	1.07965	7078.00	-0.09375	0.9062	0.0082	1.0082
15/01/2020	0.93073	7113.50	-0.13793	0.8621	0.0050	1.0050
16/01/2020	0.93073	7158.60	0.00000	1.0000	0.0063	1.0063
17/01/2020	0.89351	7180.30	-0.03999	0.9600	0.0030	1.0030
21/01/2020	1.04242	7196.30	0.16666	1.1667	0.0022	1.0022
22/01/2020	0.96796	7180.50	-0.07143	0.9286	-0.0022	0.9978
23/01/2020	0.93073	7249.00	-0.03846	0.9615	0.0095	1.0095
24/01/2020	0.85628	7199.00	-0.07999	0.9200	-0.0069	0.9931
27/01/2020	0.74459	7203.20	-0.13044	0.8696	0.0006	1.0006
28/01/2020	0.78182	7129.30	0.05000	1.0500	-0.0103	0.9897
29/01/2020	0.73714	7135.90	-0.05715	0.9429	0.0009	1.0009
30/01/2020	0.70736	7108.60	-0.04040	0.9596	-0.0038	0.9962
31/01/2020	0.68502	7121.20	-0.03158	0.9684	0.0018	1.0018
3/02/2020	0.69247	7019.90	0.01088	1.0109	-0.0142	0.9858
4/02/2020	0.69247	7047.60	0.00000	1.0000	0.0039	1.0039
5/02/2020	0.67013	7080.90	-0.03226	0.9677	0.0047	1.0047
6/02/2020	0.67013	7146.50	0.00000	1.0000	0.0093	1.0093
7/02/2020	0.66268	7121.40	-0.01112	0.9889	-0.0035	0.9965
10/02/2020	0.78182	7108.00	0.17979	1.1798	-0.0019	0.9981
11/02/2020	0.85628	7181.50	0.09524	1.0952	0.0103	1.0103
12/02/2020	0.96796	7185.30	0.13042	1.1304	0.0005	1.0005
13/02/2020	1.15411	7204.60	0.19231	1.1923	0.0027	1.0027
14/02/2020	1.15411	7227.10	0.00000	1.0000	0.0031	1.0031
18/02/2020	1.07965	7221.20	-0.06452	0.9355	-0.0008	0.9992
19/02/2020	1.07965	7208.30	0.00000	1.0000	-0.0018	0.9982
20/02/2020	1.11964	7237.40	0.03704	1.0370	0.0040	1.0040
21/02/2020	0.135	7255.20	-0.87943	0.1206	0.0025	1.0025
24/02/2020	1.03966	7230.40	6.70119	7.7012	-0.0034	0.9966
25/02/2020	0.95969	7065.40	-0.07692	0.9231	-0.0228	0.9772
26/02/2020	0.79174	6953.80	-0.17500	0.8250	-0.0158	0.9842
27/02/2020	0.73576	6790.70	-0.07071	0.9293	-0.0235	0.9765
28/02/2020	0.66379	6737.40	-0.09782	0.9022	-0.0078	0.9922
2/03/2020	0.56782	6511.50	-0.14458	0.8554	-0.0335	0.9665
3/03/2020	0.59181	6461.10	0.04225	1.0422	-0.0077	0.9923
4/03/2020	0.6078	6511.60	0.02702	1.0270	0.0078	1.0078
5/03/2020	0.52783	6398.50	-0.13157	0.8684	-0.0174	0.9826
6/03/2020	0.59981	6472.40	0.13637	1.1364	0.0115	1.0115
9/03/2020	0.54382	6287.50	-0.09335	0.9067	-0.0286	0.9714
10/03/2020	0.51983	5822.40	-0.04411	0.9559	-0.0740	0.9260
11/03/2020	0.6158	5995.80	0.18462	1.1846	0.0298	1.0298
12/03/2020	0.6078	5789.30	-0.01299	0.9870	-0.0344	0.9656
13/03/2020	0.55982	5370.90	-0.07894	0.9211	-0.0723	0.9277
16/03/2020	0.50384	5590.70	-0.10000	0.9000	0.0409	1.0409
17/03/2020	0.47585	5058.20	-0.05555	0.9444	-0.0952	0.9048
18/03/2020	0.50384	5332.80	0.05882	1.0588	0.0543	1.0543
19/03/2020	0.48784	4998.80	-0.03176	0.9682	-0.0626	0.9374
20/03/2020	0.46385	4809.40	-0.04918	0.9508	-0.0379	0.9621
23/03/2020	0.52783	4854.30	0.13793	1.1379	0.0093	1.0093
24/03/2020	0.44786	4564.10	-0.15151	0.8485	-0.0598	0.9402
25/03/2020	0.47985	4753.30	0.07143	1.0714	0.0415	1.0415
26/03/2020	0.44786	5006.20	-0.06667	0.9333	0.0532	1.0532
27/03/2020	0.51983	5135.20	0.16070	1.1607	0.0258	1.0258