Business Finance: Stock Portfolio Selection & Return Calculation

This business finance report details the selection of seven stocks (Amcor, Blackmores, Boral, Hutchison Telecommunication, Origin Energy, Qantas Airways, and Telstra) and analyzes their performance from 2000 to 2010. It calculates the risk-free rate using Australian government bond yields and determines monthly and expected returns for each stock and the market index (AORD). The report computes average returns, beta values, and fair returns using the CAPM model, visualizing the relationship through the Security Market Line. Based on the analysis, it recommends stocks for portfolio inclusion and calculates the portfolio's overall return and beta. The study provides a comprehensive overview of stock performance, risk assessment, and portfolio construction strategies within the specified timeframe, concluding with a detailed analysis of stock selection and portfolio optimization.

BUSINESS FINANCE
Business Finance
Name of the Student:
Name of the University:
Author’s Note:

1BUSINESS FINANCE
Table of Contents
Selection of Stocks:.........................................................................................................................2
Requirement 1: Risk Free Rate........................................................................................................2
Requirement 2: Monthly & Expected Returns of Shares and Market Index...................................3
Requirement 3: Average Return of Stocks and Market Index.......................................................11
Requirement 4: Beta......................................................................................................................11
Requirement 5: Fair return under CAPM Model...........................................................................15
Requirement 6 & 7: Security Market Line....................................................................................16
Requirement 8: Selection of Stocks for Portfolio..........................................................................16
Requirement 9: Portfolio Return & Beta.......................................................................................18
Requirement 10:.............................................................................................................................19
Bibliography..................................................................................................................................21

2BUSINESS FINANCE
Selection of Stocks:
The seven stocks, which have been selected for this task, are as follows:
- Amcor Ltd. (ASX Code – AMC)
- Blackmores (ASX Code – BKL)
- Boral Ltd. (ASX Code – BLD)
- Hutchison Telecommunication (ASX Code – HTA)
- Origin energy (ASX Code – ORG)
- Qantas Airways (ASX Code – QAS)
- Telstra (ASX Code – TLS)
Requirement 1: Risk Free Rate
The shortest maturity date of any Australian government bond is 2 years, which has a
yield to maturity of 2.07%.

3BUSINESS FINANCE
Requirement 2: Monthly & Expected Returns of Shares and Market Index
Amcor (AMC) Blackmores (BKL) Boral Ltd. (BLD)
Hutchison
Telecom (HTA)
Origin Energy
(ORG)
Qantas Airways
(QAS) Telstra (TLS) AORD
Date Price Return Price Return Price Return Price Return Price Return Price Return Price Return Price Return
31-12-2000 4.60213 6.45 2.01751 1.38 1.82408 4.14847 5.95333 3291.5
31-01-2001 4.56058 -0.90% 5.86 -9.15% 2.08108 3.15% 1.16 -15.94% 1.90662 4.53% 3.32511 -19.85% 5.30142 -10.95% 3274.1 -0.53%
28-02-2001 4.39045 -3.73% 5.75 -1.88% 2.12806 2.26% 0.742 -36.03% 1.75805 -7.79% 2.56509 -22.86% 5.42133 2.26% 3096.9 -5.41%
31-03-2001 4.78245 8.93% 6.2 7.83% 2.24782 5.63% 0.68 -8.36% 1.83234 4.23% 2.83954 10.70% 5.63244 3.89% 3270.3 5.60%
30-04-2001 5.21366 9.02% 6.05 -2.42% 2.39522 6.56% 0.4 -41.18% 2.26979 23.87% 3.74735 31.97% 5.42978 -3.60% 3317.2 1.43%
31-05-2001 5.19014 -0.45% 6.4 5.79% 2.65041 10.65% 0.42 5.00% 2.47613 9.09% 3.69457 -1.41% 4.54311 -16.33% 3425.2 3.26%
30-06-2001 5.15093 -0.76% 6.4 0.00% 2.89269 9.14% 0.264 -37.14% 2.43486 -1.67% 3.48345 -5.71% 4.19689 -7.62% 3270.8 -4.51%
31-07-2001 5.06469 -1.67% 6.25 -2.34% 3.1967 10.51% 0.224 -15.15% 2.64121 8.47% 2.90288 -16.67% 4.06178 -3.22% 3217.8 -1.62%
31-08-2001 4.88437 -3.56% 5.95 -4.80% 2.70844 -15.27% 0.185 -17.41% 2.50089 -5.31% 3.27233 12.73% 4.42489 8.94% 2988 -7.14%
30-09-2001 5.16661 5.78% 6.4 7.56% 3.01245 11.22% 0.252 36.22% 2.49264 -0.33% 4.14847 26.77% 4.19689 -5.15% 3185.3 6.60%
31-10-2001 5.49355 6.33% 6.76 5.62% 2.98482 -0.92% 0.42 66.67% 2.39359 -3.97% 4.11681 -0.76% 4.64444 10.66% 3276.9 2.88%
30-11-2001 5.60566 2.04% 6.8 0.59% 3.03088 1.54% 0.67 59.52% 2.32839 -2.72% 3.88458 -5.64% 4.59378 -1.09% 3359.9 2.53%
31-12-2001 5.88006 4.90% 7.08 4.12% 3.18749 5.17% 0.63 -5.97% 2.42661 4.22% 3.99013 2.72% 4.636 0.92% 3404 1.31%
31-01-2002 5.93651 0.96% 7 -1.13% 3.7126 16.47% 0.365 -42.06% 2.50915 3.40% 4.72905 18.52% 4.35733 -6.01% 3358.6 -1.33%
28-02-2002 6.38691 7.59% 6.6 -5.71% 3.64811 -1.74% 0.47 28.77% 2.56692 2.30% 4.78179 1.12% 4.54311 4.26% 3363.3 0.14%
31-03-2002 5.8095 -9.04% 6.75 2.27% 3.40859 -6.57% 0.435 -7.45% 2.65772 3.54% 4.75016 -0.66% 4.29822 -5.39% 3299.5 -1.90%
30-04-2002 7.11663 22.50% 6.75 0.00% 3.55599 4.32% 0.4 -8.05% 2.84755 7.14% 4.82405 1.56% 3.99422 -7.07% 3325.1 0.78%
31-05-2002 6.47967 -8.95% 6.62 -1.93% 3.45465 -2.85% 0.355 -11.25% 2.78152 -2.32% 4.85572 0.66% 3.93511 -1.48% 3163.2 -4.87%
30-06-2002 6.54258 0.97% 6.2 -6.34% 3.58362 3.73% 0.35 -1.41% 2.75676 -0.89% 5.11962 5.43% 4.06178 3.22% 3032.6 -4.13%
31-07-2002 6.96722 6.49% 6.05 -2.42% 3.96133 10.54% 0.36 2.86% 3.0704 11.38% 4.45154 -13.05% 4.104 1.04% 3073.7 1.36%
31-08-2002 6.47967 -7.00% 6.15 1.65% 3.85078 -2.79% 0.22 -38.89% 2.92184 -4.84% 3.81257 -14.35% 4.00267 -2.47% 2928.3 -4.73%
30-09-2002 6.39317 -1.33% 6 -2.44% 3.84157 -0.24% 0.24 9.09% 3.09517 5.93% 4.01491 5.31% 4.01955 0.42% 2995 2.28%
31-10-2002 6.44821 0.86% 6.1 1.67% 3.86921 0.72% 0.23 -4.17% 2.97136 -4.00% 4.03621 0.53% 3.85911 -3.99% 3025.2 1.01%

4BUSINESS FINANCE
30-11-2002 6.67626 3.54% 6.04 -0.98% 4.00739 3.57% 0.28 21.74% 3.06215 3.06% 4.07881 1.06% 3.724 -3.50% 2975.5 -1.64%
31-12-2002 6.51112 -2.47% 6.05 0.17% 3.96133 -1.15% 0.25 -10.71% 3.21072 4.85% 3.98296 -2.35% 3.79155 1.81% 2935.4 -1.35%
31-01-2003 6.47967 -0.48% 5.6 -7.44% 4.0903 3.26% 0.265 6.00% 3.54912 10.54% 3.28009 -17.65% 3.37778 -10.91% 2778.4 -5.35%
28-02-2003 6.37744 -1.58% 5.55 -0.89% 4.2377 3.60% 0.29 9.43% 3.51611 -0.93% 3.16294 -3.57% 3.43689 1.75% 2848.6 2.53%
31-03-2003 6.53471 2.47% 6.5 17.12% 4.3851 3.48% 0.315 8.62% 3.70595 5.40% 3.38658 7.07% 3.55511 3.44% 2970.9 4.29%
30-04-2003 6.44821 -1.32% 5.95 -8.46% 4.51407 2.94% 0.27 -14.29% 3.7142 0.22% 3.42918 1.26% 3.80844 7.13% 2979.8 0.30%
31-05-2003 6.3853 -0.98% 6.32 6.22% 4.66147 3.27% 0.28 3.70% 3.34278 -10.00% 3.48243 1.55% 3.71555 -2.44% 2998.9 0.64%
30-06-2003 6.58976 3.20% 6.74 6.65% 5.08524 9.09% 0.35 25.00% 3.40056 1.73% 3.39723 -2.45% 3.952 6.36% 3106.7 3.59%
31-07-2003 7.1009 7.76% 6.76 0.30% 4.91021 -3.44% 0.34 -2.86% 3.44182 1.21% 3.45048 1.57% 4.23911 7.26% 3202.9 3.10%
31-08-2003 6.8414 -3.65% 7.75 14.64% 4.8273 -1.69% 0.33 -2.94% 3.53262 2.64% 3.49308 1.23% 4.00267 -5.58% 3176.2 -0.83%
30-09-2003 6.68412 -2.30% 7.7 -0.65% 5.06682 4.96% 0.3 -9.09% 3.54912 0.47% 3.84452 10.06% 4.00267 0.00% 3282.4 3.34%
31-10-2003 6.49539 -2.82% 7.93 2.99% 4.6062 -9.09% 0.28 -6.67% 3.85451 8.60% 3.54633 -7.76% 4.16311 4.01% 3195.7 -2.64%
30-11-2003 6.49539 0.00% 7.84 -1.13% 4.6799 1.60% 0.3 7.14% 3.92054 1.71% 3.50373 -1.20% 4.07022 -2.23% 3306 3.45%
31-12-2003 6.22017 -4.24% 8.05 2.68% 5.08524 8.66% 0.285 -5.00% 4.32498 10.32% 3.68477 5.17% 4.15467 2.07% 3283.6 -0.68%
31-01-2004 6.06289 -2.53% 8.11 0.75% 5.65641 11.23% 0.265 -7.02% 4.63037 7.06% 3.95101 7.23% 4.03644 -2.85% 3372.5 2.71%
29-02-2004 6.29094 3.76% 9.05 11.59% 5.82223 2.93% 0.27 1.89% 4.53958 -1.96% 3.63152 -8.09% 3.83378 -5.02% 3416.4 1.30%
31-03-2004 5.45739 -13.25% 9.31 2.87% 5.52744 -5.06% 0.28 3.70% 4.70465 3.64% 3.56763 -1.76% 4.03644 5.29% 3407.7 -0.25%
30-04-2004 5.21362 -4.47% 9.1 -2.26% 5.46295 -1.17% 0.27 -3.57% 4.55608 -3.16% 3.61022 1.19% 3.96044 -1.88% 3456.9 1.44%
31-05-2004 5.48098 5.13% 10 9.89% 5.95121 8.94% 0.355 31.48% 4.65513 2.17% 3.74867 3.83% 4.24755 7.25% 3530.3 2.12%
30-06-2004 5.39448 -1.58% 10.26 2.60% 6.67899 12.23% 0.46 29.58% 5.0183 7.80% 3.71672 -0.85% 4.16311 -1.99% 3546.1 0.45%
31-07-2004 5.76407 6.85% 11.45 11.60% 6.4671 -3.17% 0.355 -22.83% 4.86973 -2.96% 3.63152 -2.29% 4.05333 -2.64% 3561.9 0.45%
31-08-2004 5.64612 -2.05% 13.1 14.41% 6.34734 -1.85% 0.325 -8.45% 5.01004 2.88% 3.67412 1.17% 3.92667 -3.12% 3674.7 3.17%
30-09-2004 5.99998 6.27% 14.4 9.92% 6.11703 -3.63% 0.335 3.08% 5.5713 11.20% 3.53568 -3.77% 3.94355 0.43% 3786.3 3.04%
31-10-2004 5.82698 -2.88% 13.5 -6.25% 6.35655 3.92% 0.365 8.96% 5.81891 4.44% 3.81257 7.83% 4.16311 5.57% 3942.8 4.13%
30-11-2004 5.7798 -0.81% 13.74 1.78% 6.32892 -0.43% 0.36 -1.37% 5.68685 -2.27% 3.95101 3.63% 4.14622 -0.41% 4053.1 2.80%
31-12-2004 5.58321 -3.40% 14.17 3.13% 6.63293 4.80% 0.345 -4.17% 5.75288 1.16% 3.79127 -4.04% 4.17155 0.61% 4106.7 1.32%
31-01-2005 5.64612 1.13% 14.25 0.56% 5.89593 -11.11% 0.33 -4.35% 5.88239 2.25% 3.86581 1.97% 4.44178 6.48% 4156.5 1.21%
28-02-2005 5.63039 -0.28% 13.6 -4.56% 5.61956 -4.69% 0.325 -1.52% 6.0609 3.03% 3.78062 -2.20% 4.29822 -3.23% 4100.6 -1.34%
31-03-2005 5.07993 -9.78% 12.8 -5.88% 5.32477 -5.25% 0.295 -9.23% 5.95889 -1.68% 3.42918 -9.30% 4.08711 -4.91% 3943.1 -3.84%
30-04-2005 5.33157 4.95% 12.9 0.78% 5.47216 2.77% 0.255 -13.56% 6.0694 1.85% 3.42918 0.00% 4.23911 3.72% 4070.4 3.23%
31-05-2005 5.26866 -1.18% 12.95 0.39% 5.96963 9.09% 0.27 5.88% 6.46893 6.58% 3.58892 4.66% 4.27289 0.80% 4229.9 3.92%

5BUSINESS FINANCE
30-06-2005 5.51244 4.63% 13.5 4.25% 6.19073 3.70% 0.28 3.70% 6.21391 -3.94% 3.53568 -1.48% 4.28133 0.20% 4346.7 2.76%
31-07-2005 5.19003 -5.85% 13.95 3.33% 6.6882 8.04% 0.315 12.50% 6.16291 -0.82% 3.41853 -3.31% 3.952 -7.69% 4413.5 1.54%
31-08-2005 5.27653 1.67% 14.7 5.38% 7.4344 11.16% 0.305 -3.17% 6.21391 0.83% 3.58892 4.98% 3.43689 -13.03% 4592.6 4.06%
30-09-2005 5.24507 -0.60% 14.51 -1.29% 6.983 -6.07% 0.31 1.64% 5.71238 -8.07% 3.64217 1.48% 3.55511 3.44% 4412.7 -3.92%
31-10-2005 5.51244 5.10% 14.7 1.31% 7.56338 8.31% 0.275 -11.29% 5.9929 4.91% 4.01491 10.23% 3.25111 -8.55% 4583.6 3.87%
30-11-2005 5.87416 6.56% 14.45 -1.70% 7.46204 -1.34% 0.28 1.82% 6.38392 6.52% 4.30245 7.16% 3.31867 2.08% 4708.8 2.73%
31-12-2005 5.38662 -8.30% 14.65 1.38% 8.28194 10.99% 0.275 -1.79% 6.20541 -2.80% 4.3983 2.23% 3.36089 1.27% 4880.2 3.64%
31-01-2006 5.85057 8.61% 14.25 -2.73% 8.0977 -2.22% 0.265 -3.64% 5.86539 -5.48% 4.36635 -0.73% 3.25111 -3.27% 4878.4 -0.04%
28-02-2006 5.81912 -0.54% 14.8 3.86% 8.21746 1.48% 0.255 -3.77% 6.22241 6.09% 3.76997 -13.66% 3.15822 -2.86% 5087.2 4.28%
31-03-2006 5.68544 -2.30% 14.65 -1.01% 8.77941 6.84% 0.27 5.88% 5.9929 -3.69% 3.68477 -2.26% 3.32711 5.35% 5207 2.35%
30-04-2006 5.18216 -8.85% 14.25 -2.73% 8.38328 -4.51% 0.255 -5.56% 5.83989 -2.55% 3.35463 -8.96% 3.13289 -5.84% 4972.3 -4.51%
31-05-2006 5.25293 1.37% 13.9 -2.46% 7.49889 -10.55% 0.24 -5.88% 6.25641 7.13% 3.15229 -6.03% 3.10755 -0.81% 5034 1.24%
30-06-2006 5.32371 1.35% 13.02 -6.33% 6.93693 -7.49% 0.26 8.33% 6.41793 2.58% 3.24814 3.04% 3.22578 3.80% 4957.1 -1.53%
31-07-2006 5.27653 -0.89% 14.35 10.22% 6.26443 -9.69% 0.24 -7.69% 5.66988 -11.66% 3.78062 16.39% 3.04 -5.76% 5079.8 2.48%
31-08-2006 5.84271 10.73% 14.68 2.30% 6.66056 6.32% 0.24 0.00% 5.66988 0.00% 4.164 10.14% 3.13289 3.06% 5113 0.65%
30-09-2006 5.44166 -6.86% 17 15.80% 6.69741 0.55% 0.245 2.08% 6.0949 7.50% 4.51544 8.44% 3.344 6.74% 5352.9 4.69%
31-10-2006 5.85057 7.51% 16.94 -0.35% 6.84481 2.20% 0.235 -4.08% 6.40092 5.02% 5.27157 16.75% 3.77 12.74% 5461.6 2.03%
30-11-2006 5.70116 -2.55% 18 6.26% 7.02906 2.69% 0.235 0.00% 7.02997 9.83% 5.55911 5.45% 4.14 9.81% 5644.3 3.35%
31-12-2006 5.74048 0.69% 19.4 7.78% 7.36992 4.85% 0.225 -4.26% 7.71001 9.67% 5.74015 3.26% 4.24 2.42% 5757.7 2.01%
31-01-2007 5.73262 -0.14% 20.4 5.15% 7.73841 5.00% 0.22 -2.22% 7.5315 -2.32% 5.48456 -4.45% 4.26 0.47% 5816.5 1.02%
28-02-2007 5.93707 3.57% 22 7.84% 7.59101 -1.90% 0.18 -18.18% 7.65901 1.69% 5.59105 1.94% 4.66 9.39% 5978.8 2.79%
31-03-2007 5.85844 -1.32% 22.87 3.95% 7.79369 2.67% 0.17 -5.56% 7.73551 1.00% 5.6656 1.33% 4.67 0.21% 6158.3 3.00%
30-04-2007 5.85057 -0.13% 22.45 -1.84% 8.12533 4.26% 0.14 -17.65% 7.46349 -3.52% 6.07029 7.14% 4.86 4.07% 6341.8 2.98%
31-05-2007 5.87416 0.40% 20.56 -8.42% 8.07927 -0.57% 0.13 -7.14% 8.44956 13.21% 5.96379 -1.75% 4.59 -5.56% 6310.6 -0.49%
30-06-2007 5.38662 -8.30% 22.5 9.44% 7.13961 -11.63% 0.165 26.92% 8.35605 -1.11% 6.11289 2.50% 4.6 0.22% 6187.5 -1.95%
31-07-2007 5.97639 10.95% 22.04 -2.04% 7.26858 1.81% 0.155 -6.06% 8.47506 1.42% 5.94249 -2.79% 4.37 -5.00% 6248.3 0.98%
31-08-2007 5.80339 -2.89% 21.7 -1.54% 6.62371 -8.87% 0.17 9.68% 8.75558 3.31% 5.94249 0.00% 4.36 -0.23% 6580.9 5.32%
30-09-2007 5.5203 -4.88% 22.3 2.76% 6.23679 -5.84% 0.195 14.71% 7.77802 -11.16% 6.29393 5.91% 4.68 7.34% 6779.1 3.01%
31-10-2007 5.38662 -2.42% 22 -1.35% 5.90515 -5.32% 0.2 2.56% 7.39549 -4.92% 6.23003 -1.02% 4.67 -0.21% 6593.6 -2.74%
30-11-2007 5.4338 0.88% 21.56 -2.00% 5.63799 -4.52% 0.19 -5.00% 7.523 1.72% 5.7934 -7.01% 4.69 0.43% 6421 -2.62%
31-12-2007 5.42594 -0.14% 20.5 -4.92% 5.52744 -1.96% 0.135 -28.95% 7.41249 -1.47% 4.97338 -14.15% 4.34 -7.46% 5697 -11.28%

6BUSINESS FINANCE
31-01-2008 5.56748 2.61% 19.77 -3.56% 5.56429 0.67% 0.145 7.41% 7.523 1.49% 4.49414 -9.64% 4.87 12.21% 5674.7 -0.39%
29-02-2008 5.62253 0.99% 18.49 -6.47% 5.76696 3.64% 0.125 -13.79% 7.78652 3.50% 4.1853 -6.87% 4.4 -9.65% 5409.7 -4.67%
31-03-2008 5.30798 -5.59% 19.2 3.84% 5.73011 -0.64% 0.12 -4.00% 11.8583 52.29% 3.62087 -13.49% 4.56 3.64% 5657 4.57%
30-04-2008 4.78898 -9.78% 18.6 -3.13% 5.55508 -3.05% 0.145 20.83% 13.2609 11.83% 3.69542 2.06% 4.75 4.17% 5773.9 2.07%
31-05-2008 3.97116 -17.08% 16.4 -11.83% 5.205 -6.30% 0.1 -31.03% 13.7029 3.33% 3.23749 -12.39% 4.24 -10.74% 5332.9 -7.64%
30-06-2008 4.19134 5.54% 17.9 9.15% 5.14973 -1.06% 0.115 15.00% 13.4734 -1.67% 3.53568 9.21% 4.5 6.13% 5052.6 -5.26%
31-07-2008 4.32502 3.19% 18.25 1.96% 5.942 15.38% 0.11 -4.35% 13.7284 1.89% 3.59957 1.81% 4.35 -3.33% 5215.5 3.22%
31-08-2008 4.24638 -1.82% 17.37 -4.82% 5.63799 -5.12% 0.092 -16.36% 13.6944 -0.25% 3.33333 -7.40% 4.18 -3.91% 4631.3 -11.20%
30-09-2008 4.56093 7.41% 15.5 -10.77% 4.15479 -26.31% 0.087 -5.43% 13.3459 -2.54% 2.57721 -22.68% 4.12 -1.44% 3982.7 -14.00%
31-10-2008 4.66316 2.24% 13.65 -11.94% 3.67575 -11.53% 0.076 -12.64% 13.6009 1.91% 2.47071 -4.13% 4.06 -1.46% 3672.7 -7.78%
30-11-2008 4.56093 -2.19% 13.19 -3.37% 4.25613 15.79% 0.081 6.58% 13.7029 0.75% 2.80085 13.36% 3.83 -5.67% 3659.3 -0.36%
31-12-2008 4.23852 -7.07% 12.6 -4.47% 3.0493 -28.36% 0.095 17.28% 11.9008 -13.15% 2.60916 -6.84% 3.79 -1.04% 3478.1 -4.95%
31-01-2009 3.46002 -18.37% 11.8 -6.35% 2.60711 -14.50% 0.09 -5.26% 11.5608 -2.86% 1.66667 -36.12% 3.55 -6.33% 3296.9 -5.21%
28-02-2009 3.49934 1.14% 12.3 4.24% 3.32568 27.56% 0.098 8.89% 12.5808 8.82% 1.85836 11.50% 3.21 -9.58% 3532.3 7.14%
31-03-2009 3.7667 7.64% 15.73 27.89% 3.76787 13.30% 0.105 7.14% 13.8474 10.07% 2.10863 13.47% 3.33 3.74% 3744.7 6.01%
30-04-2009 4.01834 6.68% 15.92 1.21% 3.74945 -0.49% 0.13 23.81% 12.5808 -9.15% 2.0394 -3.28% 3.11 -6.61% 3813.3 1.83%
31-05-2009 3.92397 -2.35% 16 0.50% 3.74945 0.00% 0.105 -19.23% 12.4448 -1.08% 2.14058 4.96% 3.39 9.00% 3947.8 3.53%
30-06-2009 3.89252 -0.80% 15.8 -1.25% 4.59699 22.60% 0.115 9.52% 12.3258 -0.96% 2.47071 15.42% 3.53 4.13% 4249.5 7.64%
31-07-2009 5.18079 33.10% 19.8 25.32% 5.33398 16.03% 0.125 8.70% 13.0144 5.59% 2.69436 9.05% 3.26 -7.65% 4484.1 5.52%
31-08-2009 4.9204 -5.03% 20.34 2.73% 5.61035 5.18% 0.115 -8.00% 13.8729 6.60% 3.04579 13.04% 3.27 0.31% 4739.3 5.69%
30-09-2009 5.16283 4.93% 20.7 1.77% 5.34319 -4.76% 0.115 0.00% 13.6604 -1.53% 2.9819 -2.10% 3.32 1.53% 4646.9 -1.95%
31-10-2009 5.30649 2.78% 20.6 -0.48% 5.15894 -3.45% 0.135 17.39% 13.2694 -2.86% 2.7689 -7.14% 3.41 2.71% 4715.5 1.48%
30-11-2009 5.59382 5.41% 20.9 1.46% 5.48138 6.25% 0.12 -11.11% 14.2979 7.75% 3.18424 15.00% 3.43 0.59% 4882.7 3.55%
31-12-2009 5.28853 -5.46% 22 5.26% 4.91021 -10.42% 0.12 0.00% 13.6179 -4.76% 3.02449 -5.02% 3.34 -2.62% 4596.9 -5.85%
31-01-2010 5.32445 0.68% 21 -4.55% 4.94706 0.75% 0.11 -8.33% 14.2894 4.93% 2.8115 -7.04% 2.97 -11.08% 4651.1 1.18%
28-02-2010 5.73748 7.76% 22 4.76% 5.16815 4.47% 0.12 9.09% 14.0684 -1.55% 3.02449 7.58% 2.99 0.67% 4893.1 5.20%
31-03-2010 5.90807 2.97% 23.66 7.55% 5.45374 5.53% 0.105 -12.50% 13.9239 -1.03% 3.02449 0.00% 3.18 6.35% 4833.9 -1.21%
30-04-2010 5.51301 -6.69% 22.34 -5.58% 5.11288 -6.25% 0.097 -7.62% 12.7508 -8.43% 2.66241 -11.97% 2.94 -7.55% 4453.6 -7.87%
31-05-2010 5.7285 3.91% 22.3 -0.18% 4.44038 -13.15% 0.09 -7.22% 12.6998 -0.40% 2.34292 -12.00% 3.25 10.54% 4324.8 -2.89%
30-06-2010 5.89012 2.82% 22.71 1.84% 3.95095 -11.02% 0.099 10.00% 13.1249 3.35% 2.63046 12.27% 3.22 -0.92% 4507.4 4.22%
31-07-2010 6.05174 2.74% 24.15 6.34% 4.10004 3.77% 0.11 11.11% 12.9634 -1.23% 2.67306 1.62% 2.75 -14.60% 4438.8 -1.52%

7BUSINESS FINANCE
31-08-2010 5.84522 -3.41% 28.26 17.02% 4.29573 4.77% 0.105 -4.55% 13.4734 3.93% 2.97125 11.16% 2.62 -4.73% 4636.9 4.46%
30-09-2010 6.03378 3.23% 27.56 -2.48% 4.09073 -4.77% 0.105 0.00% 13.5499 0.57% 3.02449 1.79% 2.67 1.91% 4733.4 2.08%
31-10-2010 5.79135 -4.02% 28.6 3.77% 4.20255 2.73% 0.105 0.00% 13.3714 -1.32% 2.80085 -7.39% 2.81 5.24% 4676.4 -1.20%
30-11-2010 6.06071 4.65% 28 -2.10% 4.50073 7.10% 0.099 -5.71% 14.1619 5.91% 2.70501 -3.42% 2.79 -0.71% 4846.9 3.65%
31-12-2010 6.17744 1.93% 27.91 -0.32% 4.49141 -0.21% 0.1 1.01% 13.9154 -1.74% 2.55591 -5.51% 2.8 0.36% 4850 0.06%
31-01-2011 6.21336 0.58% 31.5 12.86% 5.12506 14.11% 0.1 0.00% 14.1874 1.95% 2.49201 -2.50% 2.785 -0.54% 4923.6 1.52%
28-02-2011 6.33906 2.02% 29.92 -5.02% 4.65914 -9.09% 0.093 -7.00% 14.1895 0.01% 2.32162 -6.84% 2.82 1.26% 4928.6 0.10%
31-03-2011 6.28519 -0.85% 30.11 0.64% 4.5846 -1.60% 0.09 -3.23% 14.3032 0.80% 2.24707 -3.21% 2.91 3.19% 4899 -0.60%
30-04-2011 6.4917 3.29% 28 -7.01% 4.29573 -6.30% 0.083 -7.78% 14.3382 0.24% 2.23642 -0.47% 3.02 3.78% 4788.9 -2.25%
31-05-2011 6.46476 -0.41% 26.7 -4.64% 4.10004 -4.56% 0.068 -18.07% 13.8133 -3.66% 1.95953 -12.38% 2.89 -4.30% 4659.8 -2.70%
30-06-2011 6.3211 -2.22% 28.22 5.69% 3.88572 -5.23% 0.069 1.47% 12.851 -6.97% 1.96486 0.27% 2.99 3.46% 4500.5 -3.42%
31-07-2011 6.01582 -4.83% 29.5 4.54% 3.43845 -11.51% 0.061 -11.59% 12.3961 -3.54% 1.67199 -14.91% 3.03 1.34% 4369.9 -2.90%
31-08-2011 6.22233 3.43% 30.29 2.68% 3.2614 -5.15% 0.058 -4.92% 11.7225 -5.43% 1.5016 -10.19% 3.1 2.31% 4070.1 -6.86%
30-09-2011 6.30314 1.30% 29.41 -2.91% 3.66209 12.29% 0.06 3.45% 12.5886 7.39% 1.71672 14.33% 3.1 0.00% 4360.5 7.13%
31-10-2011 6.51864 3.42% 27.46 -6.63% 3.2614 -10.94% 0.056 -6.67% 12.3874 -1.60% 1.61342 -6.02% 3.16 1.94% 4184.7 -4.03%
30-11-2011 6.47374 -0.69% 28.5 3.79% 3.35458 2.86% 0.056 0.00% 11.67 -5.79% 1.55485 -3.63% 3.33 5.38% 4111 -1.76%
31-12-2011 6.3211 -2.36% 28.6 0.35% 3.76459 12.22% 0.058 3.57% 12.0374 3.15% 1.67732 7.88% 3.33 0.00% 4325.7 5.22%
31-01-2012 6.37497 0.85% 27.7 -3.15% 4.10004 8.91% 0.043 -25.86% 11.9062 -1.09% 1.84239 9.84% 3.3 -0.90% 4388.1 1.44%
29-02-2012 6.68025 4.79% 27.55 -0.54% 3.75527 -8.41% 0.049 13.95% 11.6788 -1.91% 1.90096 3.18% 3.29 -0.30% 4420 0.73%
31-03-2012 6.75209 1.08% 26.52 -3.74% 3.52231 -6.20% 0.044 -10.20% 11.6 -0.67% 1.74121 -8.40% 3.54 7.60% 4467.2 1.07%
30-04-2012 6.70719 -0.66% 25.91 -2.30% 3.28935 -6.61% 0.041 -6.82% 11.2676 -2.87% 1.58679 -8.87% 3.55 0.28% 4133.7 -7.47%
31-05-2012 6.366 -5.09% 26.25 1.31% 2.74889 -16.43% 0.03 -26.83% 10.6727 -5.28% 1.14483 -27.85% 3.69 3.94% 4135.5 0.04%
30-06-2012 6.77004 6.35% 29.2 11.24% 3.13094 13.90% 0.031 3.33% 10.3315 -3.20% 1.21406 6.05% 4 8.40% 4289.4 3.72%
31-07-2012 6.76106 -0.13% 29.15 -0.17% 3.21481 2.68% 0.031 0.00% 10.4103 0.76% 1.22471 0.88% 3.85 -3.75% 4339 1.16%
31-08-2012 6.96758 3.05% 31.13 6.79% 3.57822 11.30% 0.03 -3.23% 9.90289 -4.87% 1.29925 6.09% 3.92 1.82% 4406.3 1.55%
30-09-2012 7.09328 1.80% 29.7 -4.59% 3.34526 -6.51% 0.032 6.67% 9.93788 0.35% 1.4164 9.02% 4.14 5.61% 4535.4 2.93%
31-10-2012 7.09328 0.00% 30.22 1.75% 3.74595 11.98% 0.03 -6.25% 9.60545 -3.35% 1.41108 -0.38% 4.31 4.11% 4518 -0.38%
30-11-2012 7.24592 2.15% 33.65 11.35% 4.07209 8.71% 0.03 0.00% 10.1653 5.83% 1.58679 12.45% 4.37 1.39% 4664.6 3.24%
31-12-2012 7.54222 4.09% 33.85 0.59% 4.57528 12.36% 0.028 -6.67% 11.0139 8.35% 1.62939 2.68% 4.6 5.26% 4901 5.07%
31-01-2013 8.26053 9.52% 31.8 -6.06% 4.81755 5.30% 0.029 3.57% 10.6465 -3.34% 1.75186 7.52% 4.59 -0.22% 5120.4 4.48%
28-02-2013 8.33236 0.87% 30.35 -4.56% 4.57528 -5.03% 0.031 6.90% 11.6175 9.12% 1.90096 8.51% 4.51 -1.74% 4979.9 -2.74%

8BUSINESS FINANCE
31-03-2013 8.88007 6.57% 28.3 -6.75% 4.65914 1.83% 0.033 6.45% 10.7777 -7.23% 2.02343 6.44% 4.98 10.42% 5168.6 3.79%
30-04-2013 8.90701 0.30% 27.66 -2.26% 4.24914 -8.80% 0.04 21.21% 11.7837 9.33% 1.69862 -16.05% 4.74 -4.82% 4914 -4.93%
31-05-2013 9.10454 2.22% 26.94 -2.60% 3.923 -7.68% 0.046 15.00% 10.9964 -6.68% 1.4377 -15.36% 4.77 0.63% 4775.4 -2.82%
30-06-2013 9.50859 4.44% 26.13 -3.01% 3.95095 0.71% 0.042 -8.70% 10.454 -4.93% 1.34185 -6.67% 4.99 4.61% 5035.7 5.45%
31-07-2013 9.36493 -1.51% 27.09 3.67% 3.91368 -0.94% 0.043 2.38% 11.5913 10.88% 1.459 8.73% 4.9 -1.80% 5125.3 1.78%
31-08-2013 9.39186 0.29% 27.97 3.25% 4.47278 14.29% 0.07 62.79% 12.3349 6.42% 1.57082 7.66% 4.97 1.43% 5217.7 1.80%
30-09-2013 9.73306 3.63% 22.65 -19.02% 4.60323 2.92% 0.09 28.57% 12.7985 3.76% 1.32588 -15.59% 5.18 4.23% 5420.3 3.88%
31-10-2013 9.91264 1.85% 20.24 -10.64% 4.49141 -2.43% 0.095 5.56% 12.2037 -4.65% 1.29925 -2.01% 5.06 -2.32% 5314.3 -1.96%
30-11-2013 10.55 6.43% 20.85 3.01% 4.44482 -1.04% 0.085 -10.53% 12.3086 0.86% 1.16613 -10.25% 5.25 3.75% 5353.1 0.73%
31-12-2013 10.71 1.52% 21.83 4.70% 4.42618 -0.42% 0.084 -1.18% 12.2299 -0.64% 1.17146 0.46% 5.14 -2.10% 5205.1 -2.76%
31-01-2014 10.11 -5.60% 25.51 16.86% 5.19028 17.26% 0.089 5.95% 12.6323 3.29% 1.24068 5.91% 5.05 -1.75% 5415.4 4.04%
28-02-2014 10.39 2.77% 26.1 2.31% 5.26483 1.44% 0.087 -2.25% 12.5011 -1.04% 1.17678 -5.15% 5.08 0.59% 5403 -0.23%
31-03-2014 10.29 -0.96% 26.9 3.07% 5.3021 0.71% 0.086 -1.15% 13.0347 4.27% 1.29925 10.41% 5.22 2.76% 5470.8 1.25%
30-04-2014 10.61 3.11% 27.11 0.78% 4.93869 -6.85% 0.071 -17.44% 13.2009 1.28% 1.49627 15.16% 5.34 2.30% 5473.8 0.05%
31-05-2014 10.43 -1.70% 27.2 0.33% 4.8921 -0.94% 0.07 -1.41% 12.7898 -3.11% 1.34185 -10.32% 5.21 -2.43% 5382 -1.68%
30-06-2014 10.43 0.00% 28.39 4.37% 4.9946 2.10% 0.071 1.43% 12.5361 -1.98% 1.42173 5.95% 5.49 5.37% 5623.1 4.48%
31-07-2014 11.42 9.49% 30.3 6.73% 5.13437 2.80% 0.074 4.23% 13.5858 8.37% 1.5655 10.11% 5.56 1.28% 5624.6 0.03%
31-08-2014 11.33 -0.79% 32.24 6.40% 4.63119 -9.80% 0.072 -2.70% 13.096 -3.61% 1.4803 -5.44% 5.3 -4.68% 5296.8 -5.83%
30-09-2014 11.72 3.44% 32.96 2.23% 4.62187 -0.20% 0.063 -12.50% 12.4836 -4.68% 1.78914 20.86% 5.63 6.23% 5505 3.93%
31-10-2014 12.16 3.75% 33 0.12% 4.55664 -1.41% 0.062 -1.59% 10.7165 -14.16% 2.04473 14.29% 5.69 1.07% 5298.1 -3.76%
30-11-2014 13.58 11.68% 35.19 6.64% 4.93869 8.38% 0.06 -3.23% 10.2091 -4.73% 2.55591 25.00% 5.97 4.92% 5388.6 1.71%
31-12-2014 12.78 -5.89% 40.36 14.69% 5.21824 5.66% 0.06 0.00% 9.34301 -8.48% 2.77955 8.75% 6.5 8.88% 5551.6 3.02%
31-01-2015 13.66 6.89% 45 11.50% 5.72143 9.64% 0.066 10.00% 10.6815 14.33% 3.07774 10.73% 6.37 -2.00% 5898.5 6.25%
28-02-2015 14.04 2.78% 54.55 21.22% 5.94506 3.91% 0.073 10.61% 9.89414 -7.37% 3.32268 7.96% 6.31 -0.94% 5861.9 -0.62%
31-03-2015 13.53 -3.63% 63.62 16.63% 5.89847 -0.78% 0.085 16.44% 11.1451 12.64% 3.61022 8.65% 6.23 -1.27% 5773.7 -1.50%
30-04-2015 14.5 7.17% 78.1 22.76% 5.83325 -1.11% 0.09 5.88% 11.6438 4.47% 3.74867 3.83% 6.22 -0.16% 5774.9 0.02%
31-05-2015 13.72 -5.38% 75.27 -3.62% 5.4512 -6.55% 0.077 -14.44% 10.4715 -10.07% 3.36528 -10.23% 6.14 -1.29% 5451.2 -5.61%
30-06-2015 14.41 5.03% 88.5 17.58% 6.18734 13.50% 0.074 -3.90% 9.92038 -5.26% 3.99361 18.67% 6.49 5.70% 5681.7 4.23%
31-07-2015 13.42 -6.87% 105 18.64% 5.73 -7.39% 0.07 -5.41% 7.22596 -27.16% 3.57827 -10.40% 5.77 -11.09% 5222.1 -8.09%
31-08-2015 13.17 -1.86% 145.95 39.00% 4.91074 -14.30% 0.094 34.29% 5.33636 -26.15% 3.96166 10.71% 5.61 -2.77% 5058.6 -3.13%
30-09-2015 13.65 3.64% 167.67 14.88% 5.02255 2.28% 0.094 0.00% 5.5 3.07% 3.95 -0.29% 5.4 -3.74% 5288.6 4.55%

9BUSINESS FINANCE
31-10-2015 13.52 -0.95% 183.65 9.53% 5.28347 5.19% 0.089 -5.32% 5.6 1.82% 3.64 -7.85% 5.36 -0.74% 5218.2 -1.33%
30-11-2015 13.44 -0.59% 217.98 18.69% 5.50711 4.23% 0.081 -8.99% 4.7 -16.07% 4.09 12.36% 5.61 4.66% 5344.6 2.42%
31-12-2015 13.3 -1.04% 190.57 -12.57% 5.21824 -5.25% 0.076 -6.17% 4.1 -12.77% 3.88 -5.13% 5.63 0.36% 5056.6 -5.39%
31-01-2016 14.01 5.34% 158.78 -16.68% 5.44188 4.29% 0.078 2.63% 4.43 8.05% 3.86 -0.52% 5.25 -6.75% 4947.9 -2.15%
29-02-2016 14.35 2.43% 177.15 11.57% 5.7587 5.82% 0.075 -3.85% 5.15 16.25% 4.07 5.44% 5.33 1.52% 5151.8 4.12%
31-03-2016 15.4 7.32% 161 -9.12% 6.00097 4.21% 0.08 6.67% 5.49 6.60% 3.22 -20.88% 5.36 0.56% 5316 3.19%
30-04-2016 16.28 5.71% 151.2 -6.09% 6.33643 5.59% 0.079 -1.25% 5.71 4.01% 3.08 -4.35% 5.59 4.29% 5447.8 2.48%
31-05-2016 14.93 -8.29% 131.39 -13.10% 5.79597 -8.53% 0.075 -5.06% 5.45 -4.55% 2.82 -8.44% 5.56 -0.54% 5310.4 -2.52%
30-06-2016 15.02 0.60% 157.14 19.60% 6.40166 10.45% 0.088 17.33% 5.5 0.92% 3.16 12.06% 5.77 3.78% 5644 6.28%
31-07-2016 16 6.52% 123.38 -21.48% 6.15939 -3.78% 0.078 -11.36% 5.26 -4.36% 3.24 2.53% 5.26 -8.84% 5529.4 -2.03%
31-08-2016 15.15 -5.31% 116.58 -5.51% 6.28984 2.12% 0.08 2.56% 5.42 3.04% 3.12 -3.70% 5.18 -1.52% 5525.2 -0.08%
30-09-2016 14.7 -2.97% 112.08 -3.86% 5.87052 -6.67% 0.082 2.50% 5.35 -1.29% 3.06 -1.92% 4.98 -3.86% 5402.4 -2.22%
31-10-2016 14.38 -2.18% 118.75 5.95% 5.03 -14.32% 0.076 -7.32% 5.94 11.03% 3.3 7.84% 5.05 1.41% 5502.4 1.85%
30-11-2016 14.95 3.96% 103.36 -12.96% 5.41 7.55% 0.076 0.00% 6.79 14.31% 3.33 0.91% 5.1 0.99% 5719.1 3.94%
31-12-2016 14.3 -4.35% 115.5 11.75% 5.82 7.58% 0.073 -3.95% 7.09 4.42% 3.41 2.40% 5 -1.96% 5675 -0.77%
31-01-2017 14.05 -1.75% 102.5 -11.26% 5.86 0.69% 0.079 8.22% 6.56 -7.48% 3.75 9.97% 4.82 -3.60% 5761 1.52%
28-02-2017 15.06 7.19% 112.54 9.80% 5.84 -0.34% 0.076 -3.80% 7.05 7.47% 3.89 3.73% 4.66 -3.32% 5903.8 2.48%
31-03-2017 15.71 4.32% 106.61 -5.27% 6.16 5.48% 0.074 -2.63% 7.18 1.84% 4.24 9.00% 4.22 -9.44% 5947.6 0.74%
30-04-2017 15.34 -2.36% 102.02 -4.31% 6.85 11.20% 0.06 -18.92% 7.7 7.24% 5.01 18.16% 4.4 4.27% 5761.3 -3.13%
31-05-2017 16.21 5.67% 95.84 -6.06% 6.95 1.46% 0.064 6.67% 6.86 -10.91% 5.72 14.17% 4.3 -2.27% 5764 0.05%
30-06-2017 15.34 -5.37% 88.5 -7.66% 6.92 -0.43% 0.061 -4.69% 6.92 0.87% 5.32 -6.99% 4.1 -4.65% 5773.9 0.17%
31-07-2017 16.11 5.02% 112.99 27.67% 6.67 -3.61% 0.065 6.56% 7.65 10.55% 5.72 7.52% 3.67 -10.49% 5776.3 0.04%
31-08-2017 15.21 -5.59% 118 4.43% 6.77 1.50% 0.064 -1.54% 7.48 -2.22% 5.83 1.92% 3.49 -4.90% 5744.9 -0.54%
30-09-2017 15.84 4.14% 159.72 35.36% 7.15 5.61% 0.064 0.00% 7.94 6.15% 6.15 5.49% 3.54 1.43% 5976.4 4.03%
31-10-2017 15.42 -2.65% 167.64 4.96% 7.52 5.17% 0.064 0.00% 8.93 12.47% 5.67 -7.80% 3.43 -3.11% 6057.2 1.35%
30-11-2017 15.42 0.00% 169.17 0.91% 7.79 3.59% 0.065 1.56% 9.42 5.49% 5.04 -11.11% 3.63 5.83% 6167.3 1.82%
31-12-2017 14.56 -5.58% 155.28 -8.21% 8 2.70% 0.06 -7.69% 9.34 -0.85% 5.27 4.56% 3.67 1.10% 6146.5 -0.34%
Expected Return 0.72% 1.93% 1.00% -0.46% 1.08% 0.61% -0.10% 0.38%

10BUSINESS FINANCE

11BUSINESS FINANCE
Requirement 3: Average Return of Stocks and Market Index
The expected or average returns of the selected stocks and the market index are
stated below:
Average Return Rate
AMC 0.72%
BKL 1.93%
BLD 1.00%
HTA -0.46%
ORG 1.08%
QAS 0.61%
TLS -0.10%
AORD 0.38%
Requirement 4: Beta
AMD:
Regression Statistics
Multiple R 0.291475
R Square 0.084958
Adjusted R
Square 0.080428
Standard Error 0.054165
Observations 204
ANOVA
df SS MS F
Significanc
e F
Regression 1 0.055024
0.05502
4
18.7548
6 2.34E-05
Residual 202 0.592633
0.00293
4
Total 203 0.647657
Coefficient Standard t Stat P-value Lower 95% Upper Lower Upper

12BUSINESS FINANCE
s Error 95% 95.0% 95.0%
Intercept 0.005543 0.003812 1.45404
0.14748
7 -0.00197
0.01305
9 -0.00197 0.013059
Beta 0.443004 0.102294
4.33068
8 2.34E-05 0.241303
0.64470
6 0.241303 0.644706
BKL:
Regression Statistics
Multiple R 0.2983
R Square 0.088983
Adjusted R
Square 0.084473
Standard Error 0.083958
Observations 204
ANOVA
df SS MS F
Significanc
e F
Regression 1 0.139078
0.13907
8
19.7302
5 1.47E-05
Residual 202 1.423888
0.00704
9
Total 203 1.562966
Coefficient
s
Standard
Error t Stat P-value Lower 95%
Upper
95%
Lower
95.0%
Upper
95.0%
Intercept 0.016668 0.005908
2.82104
9
0.00526
4 0.005018
0.02831
8 0.005018 0.028318
Beta 0.704307 0.158561
4.44187
4 1.47E-05 0.391661
1.01695
4 0.391661 1.016954
BLD:
Regression Statistics
Multiple R 0.564203
R Square 0.318325
Adjusted R
Square 0.31495
Standard Error 0.066066
Observations 204

13BUSINESS FINANCE
ANOVA
df SS MS F
Significanc
e F
Regression 1 0.411718
0.41171
8
94.3289
4 1.53E-18
Residual 202 0.88167
0.00436
5
Total 203 1.293388
Coefficient
s
Standard
Error t Stat P-value Lower 95%
Upper
95%
Lower
95.0%
Upper
95.0%
Intercept 0.00542 0.004649
1.16577
4
0.24508
1 -0.00375
0.01458
8 -0.00375 0.014588
Beta 1.211807 0.12477
9.71230
8 1.53E-18 0.965788
1.45782
6 0.965788 1.457826
HTA:
Regression Statistics
Multiple R 0.270148
R Square 0.07298
Adjusted R
Square 0.068391
Standard Error 0.142818
Observations 204
ANOVA
df SS MS F
Significanc
e F
Regression 1 0.324364
0.32436
4
15.9025
1 9.32E-05
Residual 202 4.120196
0.02039
7
Total 203 4.444559
Coefficient
s
Standard
Error t Stat P-value Lower 95%
Upper
95%
Lower
95.0%
Upper
95.0%
Intercept -0.0087 0.010051 -0.86558 0.38775 -0.02852
0.01111
8 -0.02852 0.011118
Beta 1.075597 0.269722
3.98779
5 9.32E-05 0.543765 1.60743 0.543765 1.60743

14BUSINESS FINANCE
ORG
Regression Statistics
Multiple R 0.326918
R Square 0.106876
Adjusted R
Square 0.102454
Standard Error 0.072063
Observations 204
ANOVA
df SS MS F
Significanc
e F
Regression 1 0.125527
0.12552
7
24.1722
8 1.82E-06
Residual 202 1.048992
0.00519
3
Total 203 1.17452
Coefficient
s
Standard
Error t Stat P-value Lower 95%
Upper
95%
Lower
95.0%
Upper
95.0%
Intercept 0.008292 0.005071
1.63496
9
0.10361
3 -0.00171
0.01829
1 -0.00171 0.018291
Beta 0.669118 0.136096
4.91653
1 1.82E-06 0.400768
0.93746
9 0.400768 0.937469
QAN
Regression Statistics
Multiple R 0.478612
R Square 0.229069
Adjusted R
Square 0.225253
Standard Error 0.086644
Observations 204
ANOVA
df SS MS F
Significanc
e F
Regression 1 0.450587 0.45058 60.0208 4.47E-13

15BUSINESS FINANCE
7 6
Residual 202 1.51645
0.00750
7
Total 203 1.967038
Coefficient
s
Standard
Error t Stat P-value Lower 95%
Upper
95%
Lower
95.0%
Upper
95.0%
Intercept 0.001345 0.006098
0.22058
4
0.82563
9 -0.01068
0.01336
8 -0.01068 0.013368
Beta 1.26772 0.163633
7.74731
3 4.47E-13 0.945071
1.59036
8 0.945071 1.590368
TLS
Regression Statistics
Multiple R 0.23354
R Square 0.054541
Adjusted R
Square 0.04986
Standard Error 0.05062
Observations 204
ANOVA
df SS MS F
Significanc
e F
Regression 1 0.029859
0.02985
9
11.6527
8 0.000775
Residual 202 0.517604
0.00256
2
Total 203 0.547463
Coefficient
s
Standard
Error t Stat P-value Lower 95%
Upper
95%
Lower
95.0%
Upper
95.0%
Intercept -0.00224 0.003562 -0.62798
0.53072
9 -0.00926
0.00478
7 -0.00926 0.004787
Beta 0.326341 0.0956
3.41361
7
0.00077
5 0.13784
0.51484
2 0.13784 0.514842

16BUSINESS FINANCE
Requirement 5: Fair return under CAPM Model
AMD BKL BLD HTA ORG QAN TLS
Beta
0.44300
4
0.70430
7
1.21180
7
1.07559
7
0.66911835
3
1.2677
2
0.32634
1
Risk Free Rate 2.07% 2.07% 2.07% 2.07% 2.07% 2.07% 2.07%
Market Return 0.38% 0.38% 0.38% 0.38% 0.38% 0.38% 0.38%
Fair Return Rate 1.32% 0.88% 0.02% 0.25% 0.94% -0.08% 1.52%
Requirement 6 & 7: Security Market Line
0 0.2 0.4 0.6 0.8 1 1.2 1.4
-0.50%
0.00%
0.50%
1.00%
1.50%
2.00%
TLS
QAN
ORG
HTA BLD
BKL
AMD
Security Market Line
SML Linear (SML) Linear (SML) Linear (SML)
AMD BKL BLD HTA
ORG QAN TLS
Requirement 8: Selection of Stocks for Portfolio
The results that have been obtained in the part 8 of the section determine the
shares that would be selected and the ones that would be rejected in the portfolio. It is
seen that there are 8 products that are available for selection in the investment portfolio
and the products needs to be selected on the basis of the risks and returns the products
will be able to provide to the investor. The security market line refers to the line that is
drawn within a chart that acts as a graphical representation of the capital asset pricing

17BUSINESS FINANCE
model, which looks to explain the different degrees of the market and the systematic risks
of several kinds of securities that are marketable that are plotted with respect to the
anticipated returns of the overall market at a certain point of time. The security market
line is an optical of the capital asset pricing model, in which the x-axis of the graph is a
representation of the risks with respect to the beta and on the other hand the y-axis if the
graph reveals the expected returns. The risk premium of the market of a particular
security is ascertained by the fact where it is plotted on the chart in accordance to the
security market line.
In accordance to the results that is obtained in the graph in relation to this
question, it is seen that more than two shares have been found to be ideal for the preferred
portfolio. The shares that are over the security market line have been chosen for the
inclusion in the portfolio because of the fact that these are the shares that have the ability
to give out the optimum amount of returns and have the lowest amount of risk. It is seen
that the shares that are above the security market line have the lowest level of risks
thereby lowering the chances of loss for the investors and on the other hand the
availability of positive returns and the returns being in accordance to the expectations of
the shareholders are ideal for the inclusion in the portfolio. On the other hand the shares
that are below the security market line are not ideal for the inclusion in the portfolio
because of the fact that these shares have the amount of risks to be higher than the
expected returns. It is always expected that those shares needs to be taken within the
portfolio that would provide higher returns and would have lowest amount of risks and
therefore all the shares that are below the line have been excluded from the portfolio.

18BUSINESS FINANCE
These are the factors that have influenced the investors from selecting the shares that are
above the security line to be included in the portfolio. The shares that have been selected
would give out effective amount of returns and thereby would be effective enough in
providing effective returns for the investors.
Requirement 9: Portfolio Return & Beta
Portfolio Return & Beta
Particulars TLS AMD ORG BKL Portfolio
Weightage 25% 25% 25% 25% 100%
Expected Return 1.52% 1.32% 0.94% 0.88% 1.16%
Beta 0.326 0.443 0.669 0.704 0.54
0 0.2 0.4 0.6 0.8 1 1.2 1.4
-0.20%
0.00%
0.20%
0.40%
0.60%
0.80%
1.00%
1.20%
1.40%
1.60%
1.80%
Portfolio
TLS
QAN
ORG
HTA
BLD
BKL
AMD
Security Market Line
SML Linear (SML) Linear (SML) Linear (SML)
AMD BKL BLD HTA
ORG QAN TLS Portfolio
The shares that have been selected in the portfolio have been given equal
weightage and it is seen that each of the four shares 25% weightage each. It is seen that

19BUSINESS FINANCE
TLS provides the highest expected return followed by AMD that provides an expected
return of 1.32%. ORG on the other hand provides an expected return of 0.94% and BKL
has the lowest amount of return and the value is 0.88%. It is seen that the risk percentage
of TLS is 0.326, which is the lowest followed by AMD that has a beta value of 0.443.
ORG has their beta value placed at 0.669 and the beta value for BKL has been found to
be 0.704. The aggregate portfolio weightage is seen to be 100% and the aggregate return
for the portfolio is 1.16% and the beta value on an average is 0.54. It is seen that the
expected returns for the portfolio are better than extent of risk and therefore the selection
of these shares are justified. Out of the four shares that have been selected, it is seen that
TLS is the most effective share that has been able to provide the highest expected return
by giving out the lowest level of return and BKL has been most amount of risk in the
portfolio by giving out the lowest amount of expected returns.
Requirement 10:
The results that have been attained have been seen to be less than certain because
of the fact that there are several internal and external factors that can have an impact on
the performance of the shares that have been included in the portfolio. It is seen that
political factor plays a significant role in the performance of the shares and changes in the
government rules and policies can have impact in the expected returns and the value of
the beta and therefore the expectations that were taken from the portfolio may not be
correct. The economic factors like the changes in the rate of interest, changes in the
market and the alterations in the inflation rate can have an impact on the share market and
accordingly can have an impact on the performance of the selected shares. It is even seen

20BUSINESS FINANCE
that societal and cultural factors can have an impact as well because of the fact that
changes in the mindset of the investors would lead to changes in the performance of the
shares and thereby can impact the level of returns and the extent of risk. In certain
scenario, the development of unprecedented events like natural calamities and political
unrest can affect the share market and thereby can make changes in the expected returns
and the level of risk. These are several factors that create various uncertainties and doubts
in the shares that have been selected in the portfolio and thereby suggest that the
conclusions that have been given in part 8 of the question to be less than certain. These
variations can hamper the aims and the goals of the investors and therefore the investors
need to be aware of the same and take measures in order to lower their unprecedented
risks.

21BUSINESS FINANCE
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