 # Topic: Financial Analysis and Investment coursework assignment

Assignment Questions [All questions should be answered]
Section1: [50% of Marks] [2000 Words (+/- 10%)]
Critically discuss the alternative asset pricing models. Explain the cons and pros of each model
reflecting on the underlying theories and relevant empirical literature. Utilise arguments from
this question into three subsections: I) introduction; II) analytical and critical discussions; III)
Conclusion
Section 2: [50% of Marks] [1500 Words (+/- 10%)]
Collect monthly prices for 7 (seven) stocks/assets of your choice for the last 10 (ten) years
traded in a market (of your choice). Use the data to construct one portfolio (i.e. same
stocks/assets). However, use it to generate two objectives the first is to maximise returns and
the second is to minimise risk. In other words, same stocks two portfolio-scenarios/objectives
one is profit maximisation and the second is risk minimisation. Report the annualised expected
returns and risks of the two objectives and any other necessary performance indicators. Report
the weighted average portfolio-beta for each objective portfolio. Use available data that can
easily be obtained online. Use dividend adjusted close prices.
Guidance:
Section 1:

1. Utilise your knowledge of the underlying theories, assumptions and limitations of
various asset pricing models including and not limited to: Capital Asset Pricing
Model (CAPM); Arbitrage Pricing Theory (APT); Multifactor Models.
2. Utilise argument and findings from updated literature to support your discussions.
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3. Support the answers with graphs and formulae where appropriate.
4. Graphs are allowed within the text. Extra graphs can be moved the Appendix at the
end.
5. Formulae should be written using the equation function in Word. Students may
include the formulae in the footnote of the page to save space.
Section 2:
7. Use the knowledge gained from Transferable Skills documents of estimating CAPM or
Market model using regression analysis and other functions in Excel.
8. Calculate each stock variance and standard deviation using Excel
9. Use the SOLVER functions in Excel to maximise (minimise) portfolio return (risk)
10. Present the work in a professional investment report and provide comments on the
results.
11. Provide sufficient justification for the choice of stocks/assets and the market.
12. Make sure to collect stock/asset prices that are dividends adjusted.
13. Provide sufficient justification on the choice of the proxy (index) of the market portfolio.
14. Present Tables in an organised manner with captions. Maximum four Tables are allowed within the text. Extra Tables can be moved the appendix at the end.
15. Support the answers with graphs and formulae where appropriate. Maximum four graphs are allowed within the text. Extra graphs can be moved the Appendix at the end.
Formulae should be written using the equation function in Word. Students may include the formulae in the footnote of the page to save space.

Type of service: Academic paper writing
Type of assignment: Coursework
Subject: Finance
Pages/words: 13/3500
Number of sources: 6