Risk Measure (Sharpe Ratio): You need to calculate the

Assignment -

1. Please submit a one-page investment report (see the exemplar) excluding references.

You are an equity analyst in an investment bank. You need to write a report on the risk and return of the following stocks listed in Australian Stock Exchange:

  • National Australia (NAB.AX)
  • BHP Billiton Limited (BHP.AX)
  • Wesfarmers Ltd (WES.)

Data sources - Daily adjusted closing stock prices for companies at Yahoo Finance

Find attached more data sources- Analysis period January 2, 2013-December 28, 2017.

Required: Write a one-page investment report on the risk and return of the above stocks with the following parts:

(a) Analysis of asset returns: The analysis of asset returns includes the discussion on average return, maximum and minimum return and distribution of returns.

(b) Portfolio Return and Risk: You need a create a three-asset portfolio having the equal weighting for each stock above. After creating the portfolio, you need to analyse portfolio return and risk.

(c) Risk Measure (Sharpe Ratio): You need to calculate the Sharpe Ratio of each stock return, assuming the risk free return during the analysis period is 3% and choose the best stock on the basis of Sharpe Ratio.

(d) Value at Risk (VaR): You need to calculate the Value at Risk using a normal distribution at 95% confidence level for each stock listed above and choose the best stock on the basis of VaR. This Unit requires you to use the Harvard referencing system.

Attachment:- Corporate Finance Assignment Files.rar


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