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Finance & Accounting
Pages 3 (753 words)
Introduction: The major aim of this appraisal report is to elaborate and explain investment portfolio for investors and executives by examining six stocks conditions in five different and distinct parts of ASX300 from 4th April 2010to 7th February 2012. This paper will show the uncertainties of these stocks and also benefits of them.
Analysis: Moments of distributions Asset Type Symbol Volatility Expected Excess Growth Rate Skewness Kurtosis Excess Asset ANZ.AX 23.59% -5.54% -0.18 3.46 Asset BHP.AX 24.21% -9.58% -0.08 0.91 Asset BOQ.AX 27.08% -24.81% -0.07 0.54 Asset HVN.AX 27.02% -34.38% -0.02 1.69 Asset TLS.AX 19.52% 1.48% -1.04 9.31 Asset WOW.AX 15.13% -10.19% -0.18 4.26 Factor ASX300 17.49% -10.41% -0.15 0.81 Volatility From the data, volatility is a measure of variation in the average trajectory leading to a risk. BOQ stocks have the highest variation at 27.08%. This implies that there is an increase in the interests hence the frequency of financial data is high leading to high volatility. HVN stocks have high volatility, as well. There is a decrease in volatility where BHP and ANZ stocks are low indicating a returns pattern which is in a stochastic process. As a result of nonparametric analysis, the pattern in the volatility changes because of financial returns making the volatility of WOW and ASX300 low (Greer, 2008). Excess growth rate The rate of returns of TLS stock is high because the risk is considerable; ANZ and BHP follow as there expectation of growth is low due to high risk. BOQ and HVN stocks have a low growth rate expectation because they have a high risk unlike the rest of the stocks (Lagerquist, 2009). ...
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