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y = Ey/N 0.24431
X = Ex/N 0.153978450570756
0.24431 = A + 1.091182*.153978
the above analysis says that in 2010 if sensex gives a return of 45% then RIL will give a return of 56.7% and if it gives 5% then RIL wi
Rm = 15.40%
Rf = 8%
β = 1.09
Ke = 16.06%
the cost of capital of RIL is 16% and the calculated expected return is 24.82% so in 2010 RIL is a better investment option.
70.0%
50.0%
X Y
5% 13.1% R 40.0%
I
L 30.0%
20.0%
50.0%
R 40.0%
10% 18.5% I
15% 24.0% L 30.0%
20% 29.5%
25% 34.9% 20.0%
30% 40.4%
35% 45.8% 10.0%
40% 51.3%
45% 56.7% 0.0%
5% 10% 15% 20% 25% S
50% 62.2%
Av monthly retruannual return std deviation mn annualise standard deviation
-0.175%
2.402%
-3.274%
-11.159% annualise std deviation
26.338%
18.350%
20.406%
-4.539%
7.718%
56.067% 12.839% 44.48%
8.718%
-17.447%
-29.573%
-8.911%
-3.148%
5.396%
-12.841%
-7.706%
15.471%
-7.882%
-0.857%
-13.938%
-72.717% 12.260% 42.471%
1.063%
2.451%
21.181%
17.183%
3.551%
11.292%
-3.403%
12.826%
14.013%
1.476%
-0.733%
7.419%
88.320% 7.812% 27.062%
2.036%
1.534%
4.709%
4.783%
14.157%
-7.532%
11.067%
-5.413%
26.569%
12.346%
-0.694%
-19.777%
43.783% 11.873% 41.129%
6.814%
9.225%
-3.900%
10.278%
2.368%
9.503%
19.925%
1.431%
-3.343%
-1.815%
4.393%
-0.216%
54.663% 6.955% 24.094%
3.299%
-2.361%
2.131%
8.968%
-2.730%
13.802%
-0.209%
-18.218%
-2.165%
-2.994%
-0.884%
-2.338%
-3.697% 7.688% 26.630%
17.441%
0.328%
9.528%
11.403%
11.563%
10.057%
8.580%
8.747%
-0.559%
-5.955%
6.776%
-7.524%
70.386% 7.601% 26.331%
2.442%
8.963%
3.272%
1.155%
-4.418%
0.000%
1.004%
-5.097%
-7.226%
-2.308%
2.621%
-1.819%
-1.412% 4.394% 15.222%
5.295%
13.470%
5.667%
-22.070%
-3.002%
-13.345%
-6.346%
32.930%
-24.002%
-5.085%
5.901%
14.624%
4.037% 16.208% 56.146% sqrt(12) =
3.264%
8.813%
-12.946%
2.672%
-0.266%
-0.868%
-0.814%
-0.922%
10.303%
0.979%
-5.336%
4.880% 6.315% 21.876%
100.00%
80.00%
60.00%
40.00%
20.00% SENSE
0.00% X
RIL
1 2 3 4 5 6 7 8 9 10
-20.00%
-40.00%
-60.00%
-80.00%
-100.00%
Alfa 7.629%
2010 Return of RIL = 24.82%
% and if it gives 5% then RIL will have a return of 13%.
investment option.
%
Colum
% nD
%
%
%
Colum
% nD
%
5% 10% 15% 20% 25% SENSEX
30% 35% 40% 45% 50%
= mnthly std dev* sqrt(12)
3.464102
SENSEX ANNUALISE RETURN FOR 10 YEARS
Date Open High Low Close Volume Adj Close Avg Monthly Annual Retu Std Dev Mthl STDEV Annualized
9/1/2009 15691.27 16035.5 15356.72 16016.32 30600 16016.32 2.23%
8/3/2009 15694.78 16002.46 14684.45 15666.64 29700 15666.64 -0.02%
7/1/2009 14493.84 15732.81 13219.99 15670.31 36300 15670.31 8.12%
6/1/2009 14790.89 15600.3 14016.95 14493.84 40300 14493.84 -0.90%
5/4/2009 11635.24 14930.54 11621.3 14625.25 54700 14625.25 28.26%
4/1/2009 9745.77 11492.1 9546.29 11403.25 52900 11403.25 17.46%
3/2/2009 8762.88 10127.09 8047.17 9708.5 46000 9708.5 9.19%
2/2/2009 9363.58 9724.87 8619.22 8891.61 36600 8891.61 -5.65%
1/2/2009 9973.06 10469.72 8631.6 9424.24 61400 9424.24 -2.31%
2,009 6.26% 56.36% 10.86% 37.62%
12/1/2008 9162.94 10188.54 8467.43 9647.31 56300 9647.31 6.10%
11/3/2008 10209.37 10945.41 8316.39 9092.72 48300 9092.72 -7.10%
10/1/2008 13006.72 13203.86 7697.39 9788.06 46400 9788.06 -23.89%
9/1/2008 14412.99 15107.01 12153.55 12860.43 31700 12860.43 -11.70%
8/1/2008 14064.26 15579.78 14002.43 14564.53 25200 14564.53 1.45%
7/1/2008 13480.02 15130.09 12514.99 14355.75 30300 14355.75 6.64%
6/2/2008 16591.46 16632.72 13405.54 13461.6 24300 13461.6 -17.99%
5/2/2008 17560.15 17735.7 16196.02 16415.57 20100 16415.57 -5.04%
4/1/2008 15771.72 17480.74 15297.96 17287.31 21100 17287.31 10.50%
3/3/2008 17227.56 17227.56 14677.24 15644.44 25900 15644.44 -11.00%
2/1/2008 17820.67 18895.34 16457.74 17578.72 16800 17578.72 -0.40%
1/2/2008 20393.1 21206.77 15332.42 17648.71 21400 17648.71 -13.00%
2,008 -5.45% -65.44% 10.59% 36.70%
12/3/2007 19547.09 20498.11 18886.4 20286.99 13800 20286.99 4.77%
11/1/2007 20130.23 20204.21 18182.83 19363.19 16600 19363.19 -2.39%
10/1/2007 17356.99 20238.16 17144.58 19837.99 30500 19837.99 14.73%
9/3/2007 15401.99 17361.47 15323.05 17291.1 20600 17291.1 12.88%
8/1/2007 15344.02 15542.4 13779.88 15318.6 16700 15318.6 -1.49%
7/2/2007 14685.16 15868.85 14638.88 15550.99 18500 15550.99 6.15%
6/1/2007 14610.28 14683.36 13946.99 14650.51 14300 14650.51 0.73%
5/3/2007 13987.77 14576.37 13562.95 14544.46 15300 14544.46 4.84%
4/2/2007 12811.93 14383.72 12425.52 13872.37 18400 13872.37 6.12%
3/1/2007 13013.74 13386.95 12316.1 13072.1 18400 13072.1 1.04%
2/1/2007 14124.36 14723.88 12800.91 12938.09 19000 12938.09 -8.18%
1/2/2007 13827.77 14325.92 13303.22 14090.92 16100 14090.92 2.21%
2,007 3.45% 41.39% 6.34% 21.98%
12/1/2006 13729.67 14035.3 12801.65 13786.91 14600 13786.91 0.66%
11/1/2006 12992.62 13799.02 12937.3 13696.31 17900 13696.31 5.67%
10/3/2006 12473.79 13075.85 12178.83 12961.9 14800 12961.9 4.07%
9/1/2006 11699.57 12485.17 11445.19 12454.42 14600 12454.42 6.46%
8/1/2006 10737.5 11794.43 10646.65 11699.05 16300 11699.05 8.89%
7/3/2006 10646.56 10940.45 9875.35 10743.88 22100 10743.88 1.27%
6/1/2006 10472.46 10626.84 8799.01 10609.25 27200 10609.25 2.03%
5/2/2006 12103.78 12671.11 9826.91 10398.61 25800 10398.61 -12.26%
4/3/2006 11342.96 12102 11008.43 11851.93 25000 11851.93 5.07%
3/1/2006 10368.75 11356.95 10344.26 11279.96 21500 11279.96 8.77%
2/1/2006 9959.24 10422.65 9713.51 10370.24 20000 10370.24 4.54%
1/2/2006 9422.49 9945.19 9158.44 9919.89 21500 9919.89 5.55%
2,006 3.39% 40.72% 5.58% 19.31%
12/1/2005 8813.82 9442.98 8769.56 9397.93 23100 9397.93 6.93%
11/1/2005 7989.86 9033.99 7891.23 8788.81 18900 8788.81 11.36%
10/3/2005 8662.99 8821.84 7656.15 7892.32 23400 7892.32 -8.60%
9/1/2005 7818.9 8722.17 7818.9 8634.48 16400 8634.48 10.62%
8/1/2005 7632.01 7921.39 7537.5 7805.43 15700 7805.43 2.23%
7/1/2005 7165.45 7708.59 7123.11 7635.42 15100 7635.42 6.14%
6/1/2005 6729.39 7228.21 6647.36 7193.85 16300 7193.85 7.13%
5/2/2005 6183.07 6772.74 6141.37 6715.11 12500 6715.11 9.11%
4/1/2005 6506.6 6649.42 6118.42 6154.44 13000 6154.44 -5.21%
3/1/2005 6725.92 6954.86 6321.31 6492.82 21700 6492.82 -3.29%
2/1/2005 6565.21 6720.94 6508.33 6713.86 20700 6713.86 2.41%
1/3/2005 6626.49 6696.31 6069.33 6555.94 20700 6555.94 -0.71%
2,005 3.18% 38.12% 6.49% 22.48%
12/1/2004 6259.28 6617.15 6176.09 6602.69 18000 6602.69 5.91%
11/1/2004 5678.65 6248.43 5649.03 6234.29 15800 6234.29 9.91%
10/1/2004 5587.46 5803.82 5558.14 5672.27 20800 5672.27 1.59%
9/1/2004 5202.16 5638.79 5178.57 5583.61 23500 5583.61 7.54%
8/2/2004 5193.25 5269.22 5022.29 5192.08 27700 5192.08 0.42%
7/1/2004 4813.76 5200.85 4723.04 5170.32 29700 5170.32 7.82%
6/1/2004 4792.01 5012.52 4613.94 4795.46 32800 4795.46 0.75%
5/3/2004 5645.86 5772.64 4227.5 4759.62 33700 4759.62 -15.83%
4/1/2004 5599.12 5979.25 5599.12 5655.09 27400 5655.09 1.15%
3/1/2004 5649.3 5951.03 5324.78 5590.6 34400 5590.6 -1.36%
2/3/2004 5715.46 6082.8 5550.17 5667.51 39000 5667.51 -0.49%
1/2/2004 5944.23 6249.6 5567.68 5695.67 41300 5695.67 -2.45%
2,004 1.25% 14.95% 6.71% 23.26%
12/1/2003 5086.86 5920.76 5082.82 5838.96 30500 5838.96 15.74%
11/3/2003 4946.93 5135 4736.7 5044.82 32600 5044.82 2.81%
10/1/2003 4452.07 4951.11 4432.93 4906.87 34500 4906.87 10.19%
9/1/2003 4248.07 4473.57 4097.55 4453.24 31200 4453.24 4.91%
8/1/2003 3800.73 4277.64 3722.08 4244.73 27900 4244.73 11.92%
7/1/2003 3617.74 3835.75 3534.06 3792.61 17000 3792.61 5.14%
6/2/2003 3176.56 3632.84 3170.38 3607.13 0 3607.13 13.41%
5/2/2003 2949.04 3200.48 2934.78 3180.75 0 3180.75 7.47%
4/1/2003 3037.54 3221.9 2904.44 2959.79 0 2959.79 -2.92%
3/3/2003 3301.67 3311.57 3039.83 3048.72 0 3048.72 -7.15%
2/3/2003 3265.08 3341.61 3218.37 3283.66 0 3283.66 1.02%
1/2/2003 3399.72 3416.92 3199.18 3250.38 0 3250.38 -3.76%
2,005 4.90% 58.78% 7.23% 25.04%
12/2/2002 3247.6 3413.83 3186.62 3377.28 0 3377.28 4.60%
11/1/2002 2956.94 3245.38 2928.63 3228.82 0 3228.82 9.48%
10/1/2002 2976.04 3038.92 2828.48 2949.32 0 2949.32 -1.41%
9/2/2002 3206.81 3227.62 2973.97 2991.36 0 2991.36 -5.97%
8/1/2002 2998.46 3185.08 2931.78 3181.23 0 3181.23 6.48%
7/1/2002 3246.44 3366.74 2932.35 2987.65 0 2987.65 -7.92%
6/3/2002 3162.27 3377.88 3148.57 3244.7 0 3244.7 3.81%
5/2/2002 3361.33 3478.02 3097.73 3125.73 0 3125.73 -6.36%
4/1/2002 3482.94 3538.49 3296.88 3338.16 0 3338.16 -3.78%
3/1/2002 3551.56 3758.27 3454.27 3469.35 0 3469.35 -2.61%
2/4/2002 3336.17 3758.11 3290 3562.31 0 3562.31 7.59%
1/2/2002 3243.84 3466.73 3243.32 3311.03 0 3311.03 1.49%
2,004 0.45% 5.39% 5.93% 20.54%
12/3/2001 3301.05 3500.2 3100.57 3262.33 0 3262.33 -0.77%
11/1/2001 3003.95 3377.81 3003.95 3287.56 0 3287.56 9.98%
10/1/2001 2817.74 3083.65 2718.41 2989.35 0 2989.35 6.32%
9/3/2001 3245.71 3267.93 2594.87 2811.6 0 2811.6 -13.35%
8/1/2001 3335 3359.07 3241.12 3244.95 0 3244.95 -2.53%
7/2/2001 3459.15 3513.79 3241.66 3329.28 0 3329.28 -3.69%
6/1/2001 3637.03 3651.32 3287.94 3456.78 0 3456.78 -4.82%
5/2/2001 3565.53 3759.96 3420.14 3631.91 0 3631.91 3.20%
4/2/2001 3491.41 3676.82 3096.51 3519.16 0 3519.16 -2.36%
3/1/2001 4288.23 4386.98 3436.75 3604.38 0 3604.38 -15.13%
2/1/2001 4303.13 4462.11 4020.68 4247.04 0 4247.04 -1.84%
1/2/2001 3953.22 4409.33 3929.37 4326.72 0 4326.72 8.93%
2,003 -1.34% -16.07% 7.79% 27.00%
12/1/2000 3968.89 4332.65 3803.69 3972.12 0 3972.12 -0.65%
11/1/2000 3749.35 4046.19 3734.98 3997.99 0 3997.99 7.73%
10/3/2000 4035.64 4197.39 3491.55 3711.02 0 3711.02 -9.27%
9/4/2000 4571.89 4790.63 4004.73 4090.38 0 4090.38 -8.64%
8/1/2000 4295.35 4500.3 4142.81 4477.31 0 4477.31 4.61%
7/3/2000 4846.69 5058.9 4052.61 4279.86 0 4279.86 -9.87%
6/1/2000 4406.52 4919.63 4321.26 4748.77 0 4748.77 7.11%
5/2/2000 4736.02 4757.89 3831.86 4433.61 0 4433.61 -4.81%
4/3/2000 5070.5 5542.81 4284.17 4657.55 0 4657.55 -6.87%
3/1/2000 5464.65 5828.79 4867.23 5001.28 0 5001.28 -8.19%
2/1/2000 5217.65 6150.69 5127.79 5447.47 0 5447.47 4.65%
1/3/2000 5209.54 5668.28 5184.48 5205.29 0 5205.29 3.98%
2,002 -1.68% -20.22% 6.95% 24.07%
12/1/1999 4609.66 5077.23 4584.74 5005.82 0 5005.82 8.30%
11/1/1999 4490.06 4770.11 4209.41 4622.21 0 4622.21 4.00%
10/1/1999 4808.63 5150.99 4368.85 4444.56 0 4444.56 -6.71%
9/1/1999 4910.64 4914.12 4513.55 4764.42 0 4764.42 -2.73%
8/2/1999 4571.36 4965.79 4470.52 4898.21 0 4898.21 7.83%
7/1/1999 4156.62 4810.33 4120.73 4542.34 0 4542.34 9.70%
6/1/1999 3954.26 4285.99 3830.15 4140.73 0 4140.73 4.40%
5/3/1999 3380.61 4197.08 3363.06 3966.07 0 3966.07 19.26%
4/1/1999 3750.22 3754.73 3183.47 3325.69 0 3325.69 -11.08%
3/1/1999 3447.5 3817.94 3417.22 3739.96 0 3739.96 15.65%
2/1/1999 3331.91 3406.28 3157.7 3233.86 0 3233.86 -2.46%
1/4/1999 3113.62 3515.49 3103.62 3315.57 0 3315.57 8.51%
2,001 4.56% 54.67% 8.95% 30.99%
12/1/1998 2803.73 3118.59 2790.32 3055.41 0 3055.41 8.71%
11/2/1998 2820.23 3027.2 2741.7 2810.66 0 2810.66 -0.07%
10/5/1998 3036.15 3045.54 2741.22 2812.49 0 2812.49 -9.34%
9/1/1998 2862.24 3266.71 2850.3 3102.29 0 3102.29 5.74%
8/3/1998 3159.02 3163.28 2838.99 2933.85 0 2933.85 -8.64%
7/1/1998 3210.6 3525.9 3079.43 3211.31 0 3211.31 -1.21%
6/1/1998 3737.25 3823.15 2951.45 3250.69 0 3250.69 -11.82%
5/4/1998 4058.75 4156.58 3589.24 3686.39 0 3686.39 -8.00%
4/1/1998 3901.44 4322 3901.44 4006.81 0 4006.81 2.93%
3/2/1998 3657.57 3999.03 3657.57 3892.75 0 3892.75 7.47%
2/2/1998 3288.78 3639.84 3261.38 3622.22 0 3622.22 12.34%
1/1/1998 3658.34 3792.86 3164.66 3224.36 0 3224.36 -11.88%
2,000 -1.15% -13.77% 8.62% 29.87%
12/1/1997 3536.07 3711.26 3247.63 3658.98 0 3658.98 2.77%
11/3/1997 3814.75 3852.24 3388.46 3560.29 0 3560.29 -6.39%
10/1/1997 3885.41 4166.14 3795.66 3803.24 0 3803.24 -2.53%
9/1/1997 3875.26 4112.48 3758.52 3902.03 0 3902.03 0.67%
8/1/1997 4322.19 4605.41 3851.04 3876.08 0 3876.08 -9.98%
7/1/1997 4263.11 4448.06 4105.28 4305.76 0 4305.76
STDEV COMPARISION RIL Vs. SENSEX
year SENSEX
2000 -20.22%
2001 -16.07%
2002 5.39%
2003 58.78%
2004 14.95%
2005 38.12%
2006 40.72%
2007 41.39%
2008 -65.44%
2009 56.36%