125.250, Assessment 2 (Group Project)
Due: 16th October, 5pm, 2019
Assessment 2 is a group project. Students will be randomly assigned (by a computer) into a group of 3
or 4 members. Group information including group number and members will be posted on Stream.
The project accounts for 20% of your final grade. It is not something that you can do in the last week
before it is due. Therefore, I suggest that you start working on it well before the due date. There is no
The project involves analyzing the risk and return characteristics of two companies of your choice.
Assuming you are working for an equity broker located in the U.S.. Your manager has asked you to
prepare a presentation on the risk and return characteristics of the Dow Jones Industrial Average
Index (DJIA) (a stock market index that indicates the value of 30 large, publicly owned companies
based in the United States) and two component companies of your choice from the list below. The
interest rate on a three-month U.S. Treasury bill can be used as the risk-free rate for US-based
Company Exchange Symbol Industry Date Added
3M NYSE MMM Conglomerate 9/08/1976
American Express NYSE AXP Financial services 30/08/1982
Apple NASDAQ AAPL Information technologies 19/03/2015
Boeing NYSE BA Aerospace and defence 12/03/1987
Caterpillar NYSE CAT Construction and mining
Chevron NYSE CVX Oil & gas 19/02/2008
Cisco Systems NASDAQ CSCO Information technologies 8/06/2009
Coca-Cola NYSE KO Food 12/03/1987
Dow Inc. NYSE DOW Chemical industry 2/04/2019
ExxonMobil NYSE XOM Oil & gas 1/10/1928
Goldman Sachs NYSE GS Financial services 20/09/2013
IBM NYSE IBM Information technologies 29/06/1979
Intel NASDAQ INTC Information technologies 1/11/1999
Johnson & Johnson NYSE JNJ Pharmaceuticals 17/03/1997
JPMorgan Chase NYSE JPM Financial services 6/05/1991
McDonald’s NYSE MCD Food 30/10/1985
Merck & Company NYSE MRK Pharmaceuticals 29/06/1979
Microsoft NASDAQ MSFT Information technologies 1/11/1999
Nike NYSE NKE Apparel 20/09/2013
Pfizer NYSE PFE Pharmaceuticals 8/04/2004
Procter & Gamble NYSE PG Consumer goods 26/05/1932
The Home Depot NYSE HD Retail 1/11/1999
Travelers NYSE TRV Financial services 8/06/2009
United Technologies NYSE UTX Conglomerate 14/03/1939
UnitedHealth Group NYSE UNH Managed health care 24/09/2012
Verizon NYSE VZ Telecommunication 8/04/2004
Visa NYSE V Financial services 20/09/2013
Walgreens Boots Alliance NASDAQ WBA Retail 26/06/2018
Walmart NYSE WMT Retail 17/03/1997
Walt Disney NYSE DIS Broadcasting and
Select two companies from the list. Download the historical data of the two companies (symbols
found in the table above), DJIA (symbol: ^DJI) and the Treasury bill (symbol: ^IRX) from Yahoo
Finance (http://finance.yahoo.com/ ).
Enter your company’s name or symbol into the “Look Up” box to find the page for the company.
Then click on “Historical Data” to select the time period (the most recent 10 years), data type (Adj
Close price) and frequency (daily). Download the data to your local drive.
Your manager points out that although the past is not always a good predictor of the future,
the clients want to use information on the historical return and risk characteristics of the
stocks when deciding their asset allocation. (8 Marks)
You should do your calculations in Excel and then transfer the key points from Excel to
Word. Both the Excel and Word will be used in the report, so your manager has warned you
to take particular care when setting out your work. Your manager has deliberately left you
with a lot of latitudes when it comes to what to be included in the report as he wants to test
your ability to think laterally. (8 Marks)
Your clients have little knowledge of finance. Therefore, you should be careful and accurate
in explaining financial concepts to your clients in the report. (2 Marks)
Your report should be in the format of a stock broker’s report. The presentation of the report
is part of the professionalism you exhibit to your clients and your manager. I am providing
several sample reports for your reference. Or you can find other broker reports and follow
their formats. (2 Marks)
Total: 20 Marks
3. Assignment submission
In Hard Copy
A cover sheet containing the names and IDs of each group member.
The report should include maximum 3 pages of analysis (font Times New Roman 12, double-
spaced) and an unlimited number of tables, figures, and notes attached in an appendix.
Please submit the hard copy to the designated assignment box located at QB2 on the due date.
The report should NOT be in ‘question and answer’ format.
In Electronic Copy
Both the Excel file containing your working, and the report in Word or PDF format
should be uploaded to Stream. Each group should submit only once.