Project 1 to 3

Project 1 (10 pts) (use the word document to enter results and answers – Save this file as Lname_BUA350_Cohort#_projects#.doc Go to Total Price data excel file – This set of files contains pricing information for a set of stocks, mutual funds, indexes, and some economic data – Choose 5 of the stocks, the four mutual funds, the 3 indexes, and 2 of the econ data pieces – Delete the stocks you do not want (yellow)(columns B – L) (keep 5 columns) – Delete the econ data you do not want (brown) (columns T – W) (keep 2 columns) Save this file as lname_BUA350_Project 1 price data.xls Copy and paste special as a picture the first five rows and first seven columns into the word document

Data gathering (do not need for this project) This step is only necessary if you wish to update the data or replace the companies. Go to input the ticker symbol and go to the historical price hyperlink. Search for the monthly price (including dividends). – Update prices as needed in the file. – The adjusted closing price has been adjusted for dividends and splits. We need 49 prices. Be sure that there are 49 rows of prices.

Project 2 (40 pts) points Sort the database so that the prices go from the earliest to latest. (Be sure to sort the entire spreadsheet.) Copy and paste special (values) all the price data in this spreadsheet from column B up to and including column Y into the finance spreadsheet in worksheet: BUA350 Proj1Data

2. 10 points Go to worksheet BUA350 Project 2 first 3 rows in first 7 columns and columns I through L Create two portfolios using the stock cells B2 to F3 and one portfolio using the mutual funds in cells I1 to L2. – Input weights for investing in the stocks you selected in Project 1. Use any weights you desire. They must add up to 1.0 – Portfolio A cannot contain a short sale. (all weights >= 0) – Portfolio B must contain at least one short sale. – Portfolio C cannot have a short sale Copy and paste the weights – Columns A1 to L3 Copy and paste the rows of statistics into the word document. (rows 53 to 65) Project 2

create covariance, correlation, and coefficient of determination matrices 3) 20 points Use data analysis add-in under Tools – If you cannot find Data Analysis, you have not installed the add-ins. Look for this in the Tools drop down box on in excel options. Also be sure to include the solver as an add-in The input range does not include the dates but does include the labels (columns from B through S and down to row 52). The output range must be the exact cells below – Covariance A68 – Correlation A88 You will get a message asking if you want to overwrite existing data. Select Yes or OK Copy and paste special as a picture, the correlation matrix into the word document.

Project 2A (70 points) 1) Which asset has the (15 points) – Mean highest returns? Lowest? – Standard deviation highest risk? Lowest? – Coefficient of variation highest risk? Lowest? 2) Describe the assumption of normally distributed data (25 points) – Define Skew and Kurtosis – If data is not normally distributed, what measures of skew and kurtosis are preferred? Why? – For each asset, list if normal or not and how you feel about the statistic measured.

Correlations (15 points) – Describe any peculiarities in the analysis. – What two assets are most highly correlated; least correlated? – What asset has the highest and lowest correlation with each of the indices? – What asset has the highest and lowest correlation with each of the economic variables? Coefficient of determination (15 points) – What does R 2 tells us. Which index has the highest R 2 with each asset? – Print the word document (don’t forget to save the file)

Project 3 (20 points) Use the Project 3 worksheet to create the risk- return space for the investments. Identify the S&P500 data point. Enter the graph into the document