Financial Data Analysis Project: CAPM, Fama-French, and Firm Data

This data analysis project focuses on applying the Capital Asset Pricing Model (CAPM) and the Fama-French three-factor model to analyze stock returns. The project involves downloading and processing daily stock price data and Fama-French factor data, calculating log returns, and merging the datasets. It requires students to perform regression analyses, interpret the results, and create visualizations. The second task involves analyzing a firm financial dataset, constructing various financial ratios like market leverage, cash holding, and tangibility, and running OLS regressions to examine the relationship between market leverage and other financial variables. The project also requires plotting and interpreting trends in cash holdings over time and discussing potential reasons for these trends. The student provides R code to support the analysis and findings.