a) Construct a portfolio that invests 50% in SCL stock and 50% in SAN stock, and to estimate beta and expected return for this portfolio. Comment on your findings on this portfolio. (5 marks)

b) Compare the estimated beta and expected return of the portfolio with those for the two individual stocks. (5 marks)

Name	SCL price	SAN price	NZX50 index	90 DAY BANK BILL (RFR) - % p.a.
Jan-15	1.43	4.80	5568.28	3.67
Feb-15	1.52	4.95	5756.68	3.64
Mar-15	1.55	4.95	5892.67	3.63
Apr-15	1.57	4.85	5835.58	3.64
May-15	1.63	4.86	5797.40	3.62
Jun-15	1.73	5.10	5844.95	3.47
Jul-15	1.70	5.20	5794.35	3.24
Aug-15	2.00	5.07	5957.85	3.06
Sep-15	2.00	5.01	5654.99	2.89
Oct-15	2.02	4.90	5585.43	2.83
Nov-15	2.11	4.95	5983.84	2.95
Dec-15	2.23	5.70	6150.68	2.85
Jan-16	2.46	5.60	6324.26	2.75
Feb-16	2.28	5.70	6174.49	2.69
Mar-16	2.35	6.40	6280.90	2.56
Apr-16	3.08	6.20	6708.02	2.33
May-16	3.35	6.00	6791.82	2.38
Jun-16	3.31	5.80	7022.40	2.42
Jul-16	2.98	5.56	6926.23	2.42
Aug-16	3.27	5.62	7356.63	2.26
Sep-16	3.21	5.85	7423.19	2.23
Oct-16	3.20	6.38	7372.49	2.20
Nov-16	3.10	6.26	6930.49	2.13
Dec-16	3.47	6.75	6932.74	2.04
Jan-17	3.45	6.78	6881.22	2.00
Feb-17	3.41	7.00	7055.50	2.02
Mar-17	3.45	7.50	7148.78	2.00
Apr-17	3.43	7.32	7225.01	2.00
May-17	3.35	7.27	7382.22	1.98
Jun-17	3.33	7.15	7450.90	1.95
Jul-17	3.34	6.95	7588.43	1.99
Aug-17	3.40	7.25	7729.44	1.96
Sep-17	3.39	7.36	7821.98	1.96
Oct-17	3.70	7.90	7928.89	1.94
Nov-17	3.78	7.90	8053.81	1.95
Dec-17	3.87	8.07	8188.83	1.91
Jan-18	4.78	8.30	8398.08	1.88
Feb-18	4.78	7.96	8383.87	1.89
Mar-18	4.49	7.70	8342.71	1.92
Apr-18	4.51	7.43	8319.07	1.97
May-18	4.51	7.60	8435.97	2.03
Jun-18	4.66	7.70	8636.16	2.01
Jul-18	4.63	7.70	8942.47	1.98
Aug-18	4.61	7.62	8859.92	1.91
Sep-18	4.81	7.70	9257.29	1.90
Oct-18	4.90	7.95	9327.27	1.90
Nov-18	4.63	7.39	8843.83	1.94
Dec-18	4.47	6.70	8876.09	1.97
Jan-19	4.50	6.60	8811.27	1.97
Feb-19	4.40	6.68	8999.17	1.93
Mar-19	4.74	6.60	9351.68	1.89
Apr-19	4.98	6.97	9853.91	1.84
May-19	4.98	6.83	9966.42	1.79
Jun-19	4.75	6.75	10117.99	1.64
Jul-19	4.67	6.81	10464.53	1.62
Aug-19	4.55	6.71	10860.82	1.46
Sep-19	4.77	6.75	10800.00	1.18
Oct-19	5.00	6.80	10996.99	1.09
Nov-19	5.21	7.05	10761.69	1.12
Dec-19	5.19	7.80	11301.98	1.22
Jan-20	5.01	7.95	11491.90	1.29
Feb-20	4.63	7.56	11550.16	1.25
Mar-20	4.10	6.90	11103.43	0.90
Apr-20	4.43	6.59	9926.08	0.49
May-20	4.88	7.00	10449.01	0.26
Jun-20	4.92	6.85	10882.41	0.26
Jul-20	4.97	6.35	11350.27	0.30
Aug-20	4.93	6.49	11666.09	0.30