Explain in words, not numbers, your strategy for the portfolio. Recall your objective was to beat the S&P500 for the measurement period. Articulate your approach for your portfolio, why you owned what you did (3) and why your positions were what they were (2).
Assignment Question
Requirements for Portfolio Review Final Paper Limit: two pages single spaced in 12 pt font. 30% of final grade Grammar, sentence structure and spelling will be graded. Information quality, evidence and assumptions are evaluated if they are used. Include(send) a separate excel file with your calculations and your portfolio once final prices are entered. Excel file with your calculations separated by sections listed below. Avoid overly casual phrases, e.g., slang, jargon, idioms, etc. DUE On or Before December 14 @5:00pm CDT, uploaded to Canvas in doc or pdf Requirements for Portfolio Review Final Paper 30% of final grade
Section 1: Portfolio Review (20%) 3 points x 5 metrics = 15 points Write up = 5 points points for clarity, grammar, logic, structure of write up Calculate the following for the portfolio: Holding period return Arithmetic daily average return Daily arithmetic excess return Compound daily return Sharpe Ratio for the portfolio Show your calculations on a separate excel file. This means showing beginning of period and end of period values for your portfolio. Portfolio performance review compared to the benchmark S&P 500 for the performance period, first trading day 9/5/23 to end date 11/30/23 (62 days). Beginning value = $100,000. Based on the above results, describe the portfolio’s performance. Points based on clarity, reasoning, grammar.
Section 2: Market Overview (18%) 3 points x 2 (HPR + Arithmetic Daily Avg return calculation) = 6 points 3 points x 4 reasons for over (2) (under) (2) performance = 12 points Macro market commentary including performance of the S&P500 during the measurement period using 2 return calculations, HPR and Arithmetic Daily Average Return. Which sectors of the market did the best (2) and worst (2) and why. Use sector ETF’s XLE, XLF, XLY, XLI, XLB, XLV, XLRE, XLK, XLP, XLC, IYZ.
Section 3: Valuation (18%) 3 stocks x 2 valuation methods (2 x 3 points each method = 6) = 18 For 3 stocks complete a valuation opinion using 2 methods for each, the DDM and comparable ratios. The result should be a fairly valued, over-valued, under-valued opinion but told in written summary.
Section 4: Contributors and Detractors (18%) 3 points x 3 detractors = 9 points 3 points x 3 contributors = 9 points Talk about the performance of the 3 biggest positive contributors to your portfolio, what the HPR return was, what weight you averaged for the measurement period of the portfolio and give reasons for the outperformance of these positions.
Section 5: Fund Positioning Strategy (11%) Explain in words, not numbers, your strategy for the portfolio. Recall your objective was to beat the S&P500 for the measurement period. Articulate your approach for your portfolio, why you owned what you did (3) and why your positions were what they were (2). What assumptions were you making about the market that informed your portfolio construction (3), what was the result (3)? Section 6: Market Outlook (15%) 5 points x 1 top risk = 5 points 5 points x 1 top opportunity = 5 points 5 points for summary assessment of the market Forecast.
