Assignment
Pick two stocks, say Walmart and IBM. Look at their monthly closing prices for last 4 years and
a. Calculate Beta for each of them
b. Using the CAPM model, calculate the expected return for each. Assume a market risk premium of 8% and risk free rate of 4%.
c. Calculate the standard deviation for each stock
d. Calculate the correlation coefficient between the two stocks
e. Form portfolios of the two stocks by changing their weights between zero and hundred percent and measure the risk and return of those portfolios
f. Using excel, graph the efficient frontier.
Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also include a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also Include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.