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Calculate monthly returns for share prices

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Reference no: EM132289927

Corporate Finance

Choose three companies that operate in different sectors of the economy. The companies must be quoted on the London Stock Exchange (LSE).

1. Using monthly data, calculate the beta values for each company.

Hints
- You will need monthly price data for the companies' shares and monthly data on the FTSE100 index, which should be used as a proxy for the market portfolio. Use data for a four year period from 1st January 2014 to 31st December 2017.

- Data for the companies is available at yahoo finance. Look up the companies in the Look Up box, and choose Equity London for LSE share prices. Then click the link to Historical Data for past share prices.

- Remember that you will need to calculate monthly returns for share prices and the FTSE. Use the adjusted closing prices (Adj close*) column as this includes the effects of share splits, dividends etc.

- Data for the FTSE100 index is available on the module Blackboard site.

2. Interpret the betas you have calculated and suggest why there are differences in the values between the three companies.

3. For the three companies you have selected, find the beta values quoted on the Financial Times website and from at least one other source. Compare the FT and other beta values with those you have calculated and explain why they may differ.

Hint

• Search for the companies
• The page can also be found through the main FT website. From the FT Home Page, select Markets, then Markets Data Home, then Companies. Use Search to find your companies. Remember to use the shares listed on the LSE.

4. Making use of any other data on your chosen companies, explain what other ways there are of measuring the riskiness of the businesses. Discuss the relative merits of beta values and these other ways of assessing risk.

In your assignment you should include all supporting formulae, calculations, spreadsheets and graphs. Any Excel sheets should be copied into your Word document. Such items will NOT count against the word limit.

Explanations of the formulae, calculations and any graphs should be included in the main part of the assignment. All data tables and spreadsheets should be included as an appendix.

Attachment:- Corporate Finance.rar

Verified Expert

This is a completely practical based assignment which ensures that the three companies that operate in different sectors of the economy.The companies must be quoted on the London Stock Exchange (LSE).It explains the Stock analysis concept as well as details as to how the valuation is conducted.

Reference no: EM132289927

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Reviews

len2289927

4/21/2019 11:13:30 PM

Weight 1 Overall structure to include use of English. 10% 2 Appropriate calculations in 1 20% 3 Appropriate interpretation in 2 20% 4 Identification and explanation in 3 20% 5 Discussion of risk measurement in 4 30% 6 Within word limit N/A Assignments to be submitted by: Friday, READ the Assessment Criteria carefully BEFORE starting your assignment. Assessment Criteria

len2289927

4/21/2019 11:13:18 PM

Submission of two copies, one in electronic format at CMS and one of hard copy, are required. Details for the submission of the copies would be provided later. Make sure that you include all the relevant data and spreadsheets in your assignment document.

len2289927

4/21/2019 11:13:04 PM

Choose three companies that operate in different sectors of the economy. The companies must be quoted on the London Stock Exchange (LSE). - do all the questions - 1500 words - for part 3, need to answer in PPT slides like this - please let me know which three companies you choose before starting to work

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