1. All of you have to set up your portfolio and make sure it will not exceed QR30000.
2. Discuss your strategies of asset allocation carefully, your analysis should consider the following points
a. What would be your preferred portfolio mix? Why? explain briefly./ just explain how we chose this portfolio?
b. Calculate the correlation and covariance matrix for the selected securities / you already done
c. Use Markowitz model to calculate the return and risk for alternative weights of the portfolio / as explained in class using EXCEL
d. Develop your optimal portfolio with different target risk and return
e. You can create the efficient frontier and select your choice and weights
f. When you find the weights allocate these 30000 on the securities sent to you, based on the weights you found.
g What is your plan next? Clearly state what is your rebalancing strategy
General format of the final report:
Covering page
- should contain the University , College, Department and Course names. Group number and students names and id numbers
Executive summary of the project
- with details of what is your understanding of the whole projects and benefits you gained
- Investment policy statement of the group, state what is your goal from investing in this portfolio. Remember this portfolio is done to the Shaikh Faisal Fund, which is socially responsible fund. This means we are should choose our investments carefully. Also, this fund has the goal to increase value, assuming we reinvest the dividends, for future students to use.
Example: you want to buy the portfolio and hold it for a period of time to generate suitable return as compared to the risk of the investments chosen (e.g 10%). Since inflation can reduce the value of the money, and inflation is high while the bank does not provided high interest so we are losing the value of our money and getting negative return if we keep the money in the bank without investing it. In addition, this money should be increased because it is for a fund that will stay for the future trading by other students, so we should socially responsible for this money. Since this portfolio will not be traded often, then our choice of a passive investment strategy will depend on the fundamental analysis of securities, and a choice of a well-diversified portfolio.
- Security selection part should contain an over view of your selection criteria and why you think it is consistent with your policy.
Part two of the project
- Analysis of the Qatar economy ( you should give reason why investment in Qatar is attractive for investors)
- Analyze the selected industries
- Analyze the selected companies
Part three of the project
- Portfolio creation and selection. In this part you should show all your technical work all the attached work files ( excel) should be sent separately ( do not print) but summarized in an appropriate way with figures in the report
References
Appendices
Extra Notes :
- make sure that you read the project description sent earlier. All the figures and tables should be numbered and sourced.
- Make sure that you understand all the parts of the project since you need to defend your work in the presentation day.