Question: Repeat problem 31, but for a value-weighted portfolio. Use the data from problem 30 to create a portfolio in which you invest $100 in each

Repeat problem 31, but for a value-weighted portfolio. Use the data from problem 30 to create a portfolio in which you invest $100 in each stock. Calculate the value of each stock investment each month ($100 × [1 + monthly rate of return]) and the value of the portfolio each month (sum of the value of each stock investment each month). Calculate the monthly rate of return on your portfolio. Using that data, calculate portfolio rate of return, calculate its statistics and compare them to the stocks. Compare the results to those in problem 31.

Use the monthly returns of the 5 companies you chose in the previous question to look at the return on an equally weighted portfolio of the 5 stocks (that is, a portfolio with equal investment in each stock each month). The portfolio rate of return each month is the equal-weighted average of the stocks' rates of return. Use Excel to calculate the portfolio's average return and standard deviation. Compare the portfolio statistics that of those of the stocks. What evidence of portfolio diversification do you find?

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Valuedportfolio monthly returns MG Return RY Return RCIB Return HSE Return BB Return Portfolio Value Return 4482902 0036 1860588 00351 1623725 00131 1281056 01497 188782 00751 9437054 00268 4327126 00... View full answer

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