Week 7 Investment

Hello everyone, I would like to discuss with you guys in regards to one of the bonds that I purchased in the beginning of my portfolio.

It is a Microsoft 1.5 year bonds, that matures in 11/03/2018. So far, this bond has given me 4.12 basis point in comparison to a 2 years bond that matures in 02/28/2019. The present value of the bond is 100.016 and given a 1.289626% of bond yield.

Thank you for your attention, I will see you guys next week.

Week 6 Investment

Hello everyone, for this week;s blog, I would like to discuss some of the findings that I found in my portfolio. Attached with a picture of the attribution function from bloomberg to further explain my findings.

First of all, my portfolio return at the moment is 1.12%, but it shows the benchmark's return (DJIA) as 1.32%, therefore, an active return of -0.20% was obtained in my portfolio. Also, the -0.20% return was attributed by -0.45% from allocation choice, 0.41% of selection ability, -0.16% of currency situation.

As you can see from the graph, in the consumer discretionary sector, a loss is noticeable and it is due to the poor selection ability. In term of health care sector, all allocation choice, selection ability, and currency situation contributed to the loss of the stocks.

In the bright side, in the information technology sector, a huge profit is gained due to the brilliant selection of the sectors and currency situation. In the consumer staples sector, even with the slight poor performance on allocation choice and currency situation, a huge profit is obtained because of the brilliant selection ability.

Further investigation on the performance would be conducted in the following week. And hopefully the performance of the portfolio would be improved.

Happy St.Patrick's Day!

Week 5 Investment

Microsoft File

Hello everyone, this week I have sold two equities entirely as they were making a huge loss in comparison to the rest of my investment, they are Douglas Dynamics and National Oilwell Varco Inc.

Besides that, I have conducted some more research in terms of looking for a new investment as the money gained from selling the previous equities. I used the bloomberg function EQS, and looking for company that PE ratio that is more than 50 in the FTSE250 index, and discover there are 19 stocks that have a PE ratio that is more than 50. However, when I use FTSE100 as a benchmark to backtest, that is a clear under performance of those stocks. Therefore, no new purchases have been made.

At the same time, I also looking for new stocks by using the same function. But this time the criteria has been changed to stocks that has a dividend yield more than 5%, 24 equities were discovered from FTSE250 index. After a carefully consideration by using backtesting with FTSE100, turns out the equities in FTSE250 that has a dividend yield more than 5%, are also under performing in the market. Therefore, no new purchase has been made due to that new criteria too.

As a conclusion, there is no new equities have been purchased, and two of the equities that is making a loss have been sold. Further investigation in term of stocks evaluation and new equities discovering will be conduct on next week.

Thank you.

Week 4 Investment

Hello everyone, this week I have decided to hold the stocks and bonds that I already have and to discuss some of the analysis in regards to my portfolio and make a few comparison with S&P Global index.

First of all, I use bloomberg to discover the number of day that my stocks went up and down. As you can see from the picture below, there are 7 days market went up and 7 days market went down, with the standard deviation of 0.46 in total. The top 3 market performance, were 1.44%, 0.65% and 0.63% respectively. At the same time, the worst 3 market performance, were -0.27%, -0.18%, and -0.13% respectively.

At the picture showed below, I used S&P Global as a benchmark to compare with my current portfolio. In term of total return, my portfolio is 1.18% lower than the benchmark, however, the 2.46% lower in the annualized standard deviation, I would say this is an acceptable phenomenon. Also, the Sharpe Ratio for my portfolio and the benchmark is 10.72% and 12.05% respectively.

At the picture below, it showed the total return % of my portfolio performance in compared to S&P Global. The general performance of my portfolio is under the benchmark performance. However, there is a short period of time that my performance is above the benchmark performance, therefore, it is hopeful that my total return in % would be above the benchmark in the future.

This picture showed my VaR for my portfolio. It is demonstrated in the picture that my Monte Carlo Simulation Var is 12,179. It is to say, the maximum loss that it might occurred to me in a day, with regards of my portfolio value (£1,030,757), is £12,179.

As a conclusion, even though with the multiple lower performance in the comparison to the benchmark, my portfolio might seem unsatisfying. However, with the lower risk analysis, I would think these performance might be acceptable. Also, it is the beginning stage of my portfolio, I have the confident that I would manage to change the situation.

Thank you for the attention and I will see you next week.

Week 3 Investment

Microsoft Excel File

Hello everyone, this week I have run through some other stock evaluation, for example sharpe ratio, treynor ratio and information ratio to re-balancing my portfolio.

Basically, both two stock GOOG US and GOOGL US show higher value in three different measurement, therefore, more shares have been purchased in order to provide the maximum outcome. Even though some of the stock show positive value on one of the ratio but it might be lack of further research if we just buy it with only one positive outcome showed.

Besides, both NOV US and LCI US show negative result on three different ratio, therefore, it is signalling clear indication to sell these stocks and action had been take.

The detailed excel workout formulas have been uploaded on the link on the second sheet of the excel file.

Thank you very much.

Week 2 Investment

Microsoft Files

Hello everyone, after applying CAPM model to the stocks that I invested last week. I have make some changes in regards to selling stocks that is overvalued.

However, even some of the stocks show selling sign, but the different of the return of those investment are not going to make a major different. Therefore, those stocks would be put on hold in my portfolio.

Week 1 Investment

Microsoft Excel File

Hi everybody, I've invested a few bonds and equities with the restriction of £1,000,000 that my client gave me.

Attached a picture of my selection.