Date	FTSE 100 / Return	EXPERIAN/ Return	GLAXOSMITHKLINE / Return
02/03/2018	-4.304	-4.731	0.150
02/04/2018	0.099	1.119	8.062
02/05/2018	7.322	9.854	4.735
02/06/2018	2.649	10.124	5.643
02/07/2018	-1.692	1.563	-0.368
02/08/2018	0.459	-0.965	1.107
02/09/2018	-0.160	4.602	4.533
02/10/2018	-0.262	1.812	-2.903
02/11/2018	-4.833	-10.371	-3.809
02/12/2018	0.016	10.606	2.447
02/01/2019	-4.531	-3.411	0.160
02/02/2019	4.303	4.393	-1.133
02/03/2019	2.000	0.819	3.343
02/04/2019	4.406	7.637	5.998
02/05/2019	-0.072	3.819	-3.348
02/06/2019	-1.729	9.038	1.344
02/07/2019	5.498	2.732	4.583
02/08/2019	-1.935	1.599	4.370
02/09/2019	-0.743	4.640	3.879
02/10/2019	-2.019	-4.511	-3.846
02/11/2019	2.832	-2.301	5.449
02/12/2019	0.219	4.422	-0.617
02/01/2020	4.496	1.345	2.681
02/02/2020	-3.620	4.902	1.328
02/03/2020	-8.471	1.196	-8.223
02/04/2020	-17.511	-19.099	-8.393
02/05/2020	5.311	7.306	7.902
02/06/2020	8.327	20.000	3.631
02/07/2020	0.533	3.342	-0.061
02/08/2020	-3.191	-3.949	-3.892
02/09/2020	-0.905	2.272	-4.931
02/10/2020	-0.473	4.055	-2.995
02/11/2020	-4.095	-3.152	-8.293
02/12/2020	14.639	-6.437	6.575
02/01/2021	0.131	3.852	-3.703
02/02/2021	0.904	-1.934	1.937
02/03/2021	1.884	-14.707	-9.997
02/04/2021	2.493	10.025	5.692
02/05/2021	3.714	9.662	4.853
02/06/2021	2.307	-2.186	1.412
02/07/2021	0.424	5.629	7.314
02/08/2021	-0.457	12.303	-0.709
02/09/2021	2.170	1.214	4.702
02/10/2021	-1.800	-4.428	-6.137
02/11/2021	3.603	9.009	12.919
02/12/2021	-1.660	2.066	-0.724
02/01/2022	3.675	5.031	4.733
02/02/2022	2.729	-11.589	2.701
02/03/2022	-1.638	-6.781	-4.613
02/04/2022	2.114	-2.414	6.864
02/05/2022	0.459	-4.087	8.475
02/06/2022	0.259	-8.023	-4.195
02/07/2022	-4.719	-4.174	4.556
02/08/2022	3.479	17.489	-6.020
02/09/2022	-0.817	-8.196	-19.311
02/10/2022	-5.003	1.716	-2.396
02/11/2022	3.487	0.751	9.548
02/12/2022	6.164	10.462	-0.494
02/01/2023	-1.289	-5.192	0.955
02/02/2023	4.999	12.885	-0.709
Mean Monthly Return	0.503	1.544	0.713
Standard Deviation	4.459792934	7.419710246	5.609850488
covariance	15.2664611	15.39160272	11.95766115
Correlation	0.461356597	0.369781869	0.477947573

Risk-free rate is 0.1

[Write no more than 2 pages in total for this question]

a. Compute and present the betas of your stocks to the FTSE-100. Explain how you have estimated them. 5 marks

b. Discuss what your estimated betas imply for the amount of market risk that these stocks carry and also what they imply for the relationship between returns on the FTSE-100 and returns on the stocks. Compare the magnitudes of your stocks estimated betas to those on the risk-free asset and the market portfolio, respectively, as part of your discussion. 5 marks

c. Use the betas you have estimated and the CAPM to estimate the required return on these stocks. Use the FTSE-100 to proxy for the market portfolio. Interpret the relative size of these required returns in terms of the risk that the stocks carry. 5 marks

d. Compute the levels of systematic and idiosyncratic risk for your stocks. Interpret your results.

\begin{tabular}{|lcccc|} \hline & Expeerian & GlaxoSmithKline & Expected return & Standard deviation \\ \cline { 2 - 5 } Portfolio weights & 1 & 0 & 1.54% & 7.42% \\ & 0.9 & 0.1 & 1.46% & 6.90% \\ & 0.8 & 0.2 & 1.38% & 6.44% \\ & 0.7 & 0.3 & 1.29% & 6.02% \\ & 0.6 & 0.4 & 1.21% & 5.68% \\ & 0.5 & 0.5 & 1.13% & 5.42% \\ & 0.4 & 0.6 & 1.05% & 5.25% \\ & 0.3 & 0.7 & 0.96% & 5.18% \\ & 0.2 & 0.8 & 0.88% & 5.22% \\ & 0.1 & 0.9 & 0.80% & 5.37% \\ & & 1 & 0.71% & 5.61% \\ \hline \end{tabular} Efficient Frontier 1.80% 1.60% 1.40% 1.20% 1.00% 0.80% 0.60% 0.40% 0.20% 0.00% \begin{tabular}{|lcccc|} \hline & Expeerian & GlaxoSmithKline & Expected return & Standard deviation \\ \cline { 2 - 5 } Portfolio weights & 1 & 0 & 1.54% & 7.42% \\ & 0.9 & 0.1 & 1.46% & 6.90% \\ & 0.8 & 0.2 & 1.38% & 6.44% \\ & 0.7 & 0.3 & 1.29% & 6.02% \\ & 0.6 & 0.4 & 1.21% & 5.68% \\ & 0.5 & 0.5 & 1.13% & 5.42% \\ & 0.4 & 0.6 & 1.05% & 5.25% \\ & 0.3 & 0.7 & 0.96% & 5.18% \\ & 0.2 & 0.8 & 0.88% & 5.22% \\ & 0.1 & 0.9 & 0.80% & 5.37% \\ & & 1 & 0.71% & 5.61% \\ \hline \end{tabular} Efficient Frontier 1.80% 1.60% 1.40% 1.20% 1.00% 0.80% 0.60% 0.40% 0.20% 0.00%