Question
Suppose you are planning to buy a modest vacation property in West Virginia, wild and wonderful, using investments from this portfolio. You will need 100,000
Suppose you are planning to buy a modest vacation property in West Virginia, wild and wonderful, using investments from this portfolio. You will need 100,000 in 10 years. You are going to set aside 2,000 every of the next 10 years starting now and will invest into the high-tech portfolio of Google, Amazon and Apple stocks. Apple is considered low innovation company now, so you will fix the fraction invested in Apple at 10%. Simulate returns of all three stocks and produce results for the following combinations of Amazon and Google in the portfolio: 0/90, 10/80, 20/70, 30/60, 40/50, 50/40, 60/30, 70/20, 80/10, 90/0. To conserve time and avoid abusing the computational power of Excel, limit your number of simulation runs to 100. (5)Analyze the results. (3)Which portfolio composition is the most favorable for the purpose?
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