Question

• Select 3 companies from different industrial sectors, e.g. high tech (computers, health), consumer non-durables (food, personal services, retailers), cyclical (mining/metals, forestry, oil & gas), etc. Note that one of the companies will be the subject of your term paper assignment described below. Ensure that you can obtain the minimum of 5 years of monthly pricing data required below.
• Obtain at least 5 years of monthly data on prices (60 months).
• Obtain at least 5 years of monthly data on a broad based market indicator (S&P 500, Russell 3000, Wilshire 5000, etc.; do not use the Dow Jones Industrials Average).
• Calculate the average monthly returns (=average function in Excel) , standard deviation of returns (=stdev function) , and correlations of returns (= correl function) , so you’ll have 4 sets for average returns, standard deviation of returns and 6 correlations -- A&B , A&C, and B&C for the companies and A& Market, B& Market, and C and Market.
• Plot prices of stocks & market indicator all vis-à-vis a beginning value of 100 (time series) [ ( P2/P1) x 100 ]

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Companies From Different Industrial Sectors

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