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FIN 4600: Stock-Trak Project Due Date: 15 December 2010 Dr.

Mayes Now that the Stock-Trak project is completed, you should have compiled a large amount of data. This compiled data will constitute the majority of the materials which you are expected to turn in. These data will consist of: 1. Your trading diary which describes the reasons that you made each trade. This should include any news clippings, charts, analysts recommendations, etc. that you used to make decisions . Only include relevant material, Im not looking for a data dump. 2. A printout of your spreadsheet that shows the daily values of your portfolio. This may include the prices of each stock in your portfolio, but at a minimum it will show the daily values and returns for the portfolio as a whole. 3. A printout of the spreadsheet that you used to track each investments performance . This should include the dates and prices of each buy and sell order. You probably used the spreadsheet that I have made available on the Web site. In addition to these materials, answer the following questions (answers must be typed): 1. Using the daily returns for your portfolio, and daily returns for the S&P 500 index calculate the beta of your portfolio for the semester. These calculations should be done in a spreadsheet, though you can do them by hand if you wish. You will include a printout of the spreadsheet or hand calculations. 2. Repeat the previous question using the weekly equity returns from your Stock-Trak reports and the weekly S&P 500. Did you get the same answers as were posted on the Web site? (Note that weekly values of your portfolios, the S&P 500, and the class averages are in the Stock-Trak results spreadsheet that I post each week.) 3. Calculate the standard deviation of your weekly portfolio returns and compare them to the S&P 500. Was the total risk of your portfolio more than or less than the S&P? 4. Using weekly portfolio returns for your portfolio and the S&P 500, compare the two on a risk-adjusted basis. You will calculate the total holding period returns, the Sharpe Index, and M2 for both portfolios. Which did better? Use 3% as the annual risk-free rate, or 0.627% weekly. 5. Do you feel that the amount of risk that you took, and the strategies you took, were appropriate for your client given the target beta that you were given? (Note: this has nothing to do with whether or not your actual beta was near the target.) If this was your own real money, would you feel comfortable trading as you did this semester? 6. What specific steps did you take during the semester to attempt to adjust your portfolio beta to better achieve your target. How successful were these steps? 7. Did you learn anything about short-term trading? Trading on news? 8. If you had it to do all over again, would you change your investment strategy in any way? If not, why? If yes, how? 9. Did you feel that the use of Stock-Trak substantially increased your understanding of portfolio management as compared to a class in which your only exposure would have been in a lecture? Would you recommend that Stock-Trak be used in future sections of FIN 4600? 10. How much time did you spend (be truthful, it wont affect your grade) each week on this project? Do NOT spend any money on fancy binders for your project. Simply type it up, including a title page, and staple it together.