Portfolio Analysis

#1
Hey guys...
can someone please tell me how i can go about analyzing a portfolio... what are the tools that can be useful? i know about beta and standard deviation.. dont exactly know how to calculate Alpha and Sharpe Ratio..

And if anyone could also tell me how to minimize the portfolio's standard deviation and what weights to assign to each stock, i would really appreciate it.

Thanx!
Farhan
 
#3
To analyze your portfolio, use tools such as beta and standard deviation to assess risk.
To calculate alpha, measure your portfolio's performance against a benchmark.
The Sharpe ratio, which measures risk-adjusted returns, is calculated by dividing the excess return by the portfolio's volatility.
To minimize standard deviation, diversify your portfolio by choosing uncorrelated assets.
The optimal weight for each stock can be determined using Modern Portfolio Theory (MPT), taking into account the risk-return trade-off. Use capital market lines to find the portfolio with the highest Sharpe ratio at a given risk level.
 
#4
Portfolio analysis involves assessing the performance and risk characteristics of an investment portfolio, typically utilizing techniques such as diversification analysis, risk-return analysis, and performance attribution to optimize investment decisions.
 

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