Portfolio Assignment Investment Management Assignment

PORTFOLIO INVESTMENT
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
Computation of risk and return of common stock & exchange traded fund................................1
Calculation of monthly return on Stock 1 and 2..........................................................................2
Calculation of monthly return on CIMB FTSE Asean 40 Malaysia ETF....................................4
Calculation of correlation between Genting Group and PPB Group...........................................5
Calculation of correlation between Genting Group and CIMB FTSE ASEAN 40 Malaysia......5
Calculation of correlation between PPB Group and CIMB FTSE ASEAN 40 Malaysia............6
PORTFOLIO CONSTRUCTION...................................................................................................7
Portfolio 1: Stock 1 and ETF.......................................................................................................7
Portfolio 2: Stock 2 and ETF.......................................................................................................7
Portfolio 3: Stock 1 and stock 2...................................................................................................8
Portfolio 4: Stock 1, Stock 2 and ETF.........................................................................................8
COMPARISON OF RISK OF THE PORTFOLIOS.......................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

Index of tables
Table 1 Calculation of monthly return of Genting Malaysia and PPB Group.................................2
Table 2 Calculation of expected return on Genting Malaysia.........................................................4
Table 3 Calculation of expected return on PPB Group...................................................................4
Table 4 Calculation of monthly return on CIMB FTSE ASEAN 40 Malaysia...............................4
Table 5 Calculation of correlation between PPB Group & Genting Group....................................5
Table 6 Calculation of correlation between Genting Group & ETF...............................................5
Table 7 Calculation of correlation PPB Group and ETF.................................................................6
Table 8 Calculation of risk and return of portfolio 1.......................................................................7
Table 9 Calculation of return and risk of portfolio 2.......................................................................7
Table 10 Calculation of risk and return of portfolio 3.....................................................................8
Table 11 Calculation of return and risk of portfolio 4.....................................................................8
Table 12 Covariance matrix.............................................................................................................8

INTRODUCTION
Portfolio investment refers to the investment made by investor in different securities i.e.
Exchange traded fund, money market securities, fixed income securities, equity funds and others
with the aim of receiving target return. Thus, portfolio consists of different type of assets i.e.
equity includes ordinary stock and debt i.e. bonds, debentures, banknotes and others (Leung, S.L
and et.al., 2016). Investment in different securities usually involves both risk and return
therefore, it is essential for the investor to make appropriate decisions regarding their assets
allocation and others so as to manage portfolio risk and earn good return. The present report lay
emphasizes upon creation of an efficient portfolio comprising the stock of two Malaysian
companies named Genting Malaysia and PPB Group listed on FTSE Bursa Malaysia Index
KLCI. Moreover, an ETFA CIMB FTSE ASEAN 40 Malaysia also have been incorporated for
the portfolio construction.
Computation of risk and return of common stock & exchange traded fund
Companies selected for the portfolio creation
Companies Industry
Genting Malaysia Berhad Real Estate
PPB Group Conglomerate industry
CIMB FTSE ASEAN 40 Malaysia Exchange Traded fund (ETF)
Genting Malaysia Bhd is a public limited company which is founded in the year 1980. It
provides hospitality and leisure service to the consumers i.e. hotel accommodation, gaming,
entertainment and others. It has two operational segments one is leisure and hospitality and
another is properties. First is involved in delivering travel and tourism related services whereas
second segment is engaged in property investment, development and its management.
PPB Group Bhd is a conglomerate company which is listed on FTSE Bursa Malaysia
KLCI and engaged in food production, property investment, waste management, and agriculture
and property development functions.
ETFA CIMB FTSE ASEAN 40 Malaysia ETF is a composition of the market value of
the biggest 40 businesses listed on the Indonesia, Malaysia, Philippines Singapore & Thailand’s
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