You are the portfolio manager of a UK-based fund and need build a portfolio of ethicalassets (investments in the following industries are not allowed: Tobacco, Defence andGambling).The fund should be a balanced portfolio of equities and bonds and must include:equities from 5 companies as well as 1 government bond and 1 corporate bondAll assets must be from ethical companies (see above).You are borrowing 10,000,000 for three weeks at a rate of 4.5% (annualised quote).Your objective as portfolio manager is to produce a fund that delivers a return of 12%(annualised and net of borrowing costs).The holding period is 3 weeks (beginning and end of investment to be decided by you, thefund manager).Trading is allowed during the investment period (transaction costs are assumed to bezero).Equities and bonds can be traded in the UK or any other foreign market of your choiceNo short-selling, nor use of other funds or derivativecontracts allowed.Additional information:Please note that at the end of your investment you will have to pay back the 10ml plusinterest calculated for three weeks Required:Part 1A) By undertaking fundamental analysis of company shares select the country where youwant to invest (preferably the UK) and two equity sectors that you expect to perform wellin the coming 3 weeks. On the basis of your analysis (qualitative as well as quantitativesuch as company news, current and expected P/E ratios, EPS, Dividends, return andsales forecasts, etc.) select 5 companies that you expect to outperform the market index /benchmark (in the UK that could be FTSE100). By undertaking fundamental analysis ongovernment and corporate bonds (government debt, expectations on credit rating,changes in yield, duration, convexity) select 2 debt securities (bonds) that you expect toperform well in the coming weeks.Hint: You can start by following the top-down approach, with a broad analysis ofsome of the major economies in terms of their macro-economic variables (GDP,Inflation, Unemployment rates) and the performance of their financial marketindexesOnce you have selected the country, examine the major sectors, i.e.pharmaceutical, IT, retail, transport, etc to evaluate how well they will performed,then select the individual assets using financial analysis B) By using your own judgement and appropriate financial concepts determine the best assetallocation (% of capital allocated to each asset within the portfolio) C) Choose a market index to be used as your benchmark (this must be representative ofyour investment and only related to Equity). Part 2Monitor the performance of the portfolio on a weekly basis (each asset price needs tobe monitored at least once a week and you will need to explain any daily change inprice > 5%). In terms of fundamental factors explain reasons for the changes you areobserving. Critically evaluate the performance of your portfolios against theperformance of the selected benchmark by using the Treynor ratio. Part 3Conclude and explain the differences you observe between your portfolioand the benchmark in terms of passive or active management theories andconcepts.