TEAM ASSIGNMENT (250/0-0-500/0) This assignment requires students to form groups and use the software \"Stocktrak to invest in the U.S. stocks and mutual funds. Students are expected to finish a presentation, and a comprehensive report based on your investment strategy and performance. Your team has been given $50,000 {don't get too excited, it's notional not real money) to investin ordinary shares listed on the New York Stock Exchange, and at least 3 U.S. mutual funds with the following list: (https://www.marketwatch.com/tools/markets/funds/a-z) Your goal 1s to (at least) ensure your portfolio of stocks match, and hopefully outperform the mutual funds you have selected and the New York Stock Exchange Index. Please note that you will not be penalised should you fail to achieve your goal: you will be marked on your presentation and report. A critical part of the report will be your understanding of why your portfolio performed as it did (a marking guide is included later in this document), and the investment process of mutual funds. You will need to monitor the performance of your shares and mutual funds on a daily basis. During the trading game, you are expected to give a presentation about the mutual funds you have selected in week 6. At the end of the game, you will be required to present a report: 1. discussing the performance of your portfolio and the ONE mutual fund vou need to choose to hold throughout the trading game investment horizon (see explanation below) using metrics such as the Sharpe ratio and Jensen's alpha (using the CAPM). 2. using metrics such as the Sharpe ratio and Jensen's alpha. you will compare the performance of your portfolio and the mutual funds you have chosen with the benchmark the NYSE Index. 3. outhine your initial strategy and discuss how, and why, it changed (1f it did). 4. discuss the influences (both good and bad) on your portfolio and all your mutual funds performance. These influences can include both global and national news (e.g., wars), major economic events and factors effecting individual companies, the strategies of mutual funds you have selected, and the impact from the regulation or events affect those mutual funds performance. Factors affecting the entire market can be thought of as systematic while things affecting individual companies are idiosyncratic. The report should be no more than 12 pages (The 12-page limit includes graphs and tables within the main context, however tables and graphs in the appendix does not count). You must use: Times New Roman Font (at minimum, 12 pitch); s | 2 line spacing; s Top, bottom, left and nght margins to be at least 2%2cm from the edge of the page; and s A4 paper. You will also be required to attach your trading screen shots from the software \"Stocktrak\" to your 12-page report (that 1s, trading screen shots in Appendix do not count toward the page limat) for audit purposes (see below). I list the penalties for not abiding to these restrictions later in this document. Please note that: s A soft copy of report should be submitted vig the tumitin on the blackboard for all students. * All members of the group are expected to be present dunng the presentation. Group report only needs one submission. The assignment may be attempted in groups of up to four students (no more). I suggest that it's best to choose people you know well and think you can work with for a long period of time. Each team will have a Stocktrak account, which allows you to do the trading. Each team should also select a group leader, who will be responsible for group communication, doing trading onhine after group discussion, and report me 1f there are any free-niders. Rules The proportion of investments in shares and funds during the week 3 must be no less than 80% of your initial cash holding. The 20% cashbalance you kept 1s for any covering of short-selling. For the 80% of your imitial cash holding, please invest 50% into the share market and 50% into mutual funds. You can invest in odd amounts of shares don't worry about rounding up or down. For example, you can invest in 101 shares rather than 100. For your mvestments in fully-paid ordinary shares: Although buy and hold could be a trading strategy, in this assignment you will have to trade at least once 1n a week. You have to include no less three stocks in your portfolio. If you would like to include more, be my guest. You could invest in at least 3 mutual funds at the beginning of your trading game. Select one of them with a long-term investment purpose and only sell it at the end of trading game. That mutual fund is used for Sharpe ratio and Jensen alpha calculation. You don't need to do any other trading for that mutual fund throughout the investment horizon. You are encouraged to sell other mutual funds and buy new mutual funds each day /week/fortnight during the trading game period. I would suggest you to transact no more than 5 mutual funds during the trading game period, but with different industries / investment targets. Otherwise it 1s not easy to limit your report within 12 pages. Y ou could buy, sell, short, cover any U.S shares you want. You could also uselimut or stop orders 1f you want. However, mutual funds do not have any short position, and you could only buy and sell them. Make sure you keep a record of the major reasons of trading by yourself. Given the importance we're placing on thinking about why you're trading, we want you to record your reasons for this trade and the information you're using. The reason can be anything: information, feelings, a whim.. A good investor, however, should have some idea of why he or she 1s trading. You should also record any information source you're using (the paper, the TV, your mother, your sigmficant other...)