hari.adams2003
F G
<h1>Vijin Mini Project On Finance</h1>
Project Title
'A study on Portfolio Optimization with Sharpe’s Optimization Model'
Research Problem
Investment management involves making shrewd investment decisions and constant monitoring of the outcome of those decisions. In this volatile and dynamic investment environment, investment decisions involve application of scientific techniques. 0f all the phases of investment management, portfolio selection is a crucial phase. Portfolio selection problem essentially involve striking the right balance between risk and return. This desirable trade-off between risk and return is achieved by application of scientific portfolio optimization models like Sharpe’s Optimization Model. The study focuses on the application of Sharpe’s Optimization Model in improving Portfolio Performance.
Primary Objective
To study the application of Sharpe’s Optimization Model in efficient asset allocation.
Secondary Objectives
To examine the mechanics of portfolio construction
To examine the use of the techniques of security analysis and portfolio analysis in determining the risk and return of a portfolio.
RESEARCH METHODOLOGY
RESEARCH DESIGN
The research design is the conceptual structure within which research will be conducted. Design includes an outline of what the researcher will do from writing the hypothesis and its operational implications of the final analysis of the data. The type of research is analytical.
TYPE OF DATA USED
The source of data is secondary in nature. The closing price of securities and closing values of CNX 500 index are the fundamental data for the study. The nature of data is secondary. The main source of information is websites of stock exchanges. References are also made to technical papers on the subject, Newspapers, Magazines, & financial journals.
CRITERIA OF SELECTION OF STOCK
Ten securities of leading companies are selected on the following basis
• Securities included in the CNX 500 are only selected on the basis that they represent major stocks in the capital market.
• As far as possible, securities are selected from different sectors.
PERIOD OF STUDY
The study was conducted for a period of 21 days extending from to 2009.
TOOLS FOR ANALYSIS
The collected data has been analyzed using basic statistical tools like regression analysis, correlation analysis, mathematical model building, and optimization techniques. Ratios and charts are also used for better exposition.
LIMITATIONS
An exhaustive study was not possible due to time constraints.
Data considered is only for past 3 year period.
Data is of secondary in nature.
Only ten securities are selected for the study.
Despite these limitations, all efforts have been taken to collect and analyze the data and present the information as accurate as possible.
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