Documentation:Learning Activities/Portfolio Project

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Portfolio Project

One of the requirements of the course is that you do a research project on managing a portfolio of securities. Let me clarify from the start – this is NOT a stock market game where your aim is to maximize your wealth. The aim of this study will be to see if you can integrate the theoretical underpinning in a more real life setting. Here is what I expect each group to do:

1. Construct a portfolio with a starting $500,000. Your portfolio can contain stocks, bonds, gold and other securities which trade. I understand that it may not be possible to have a perfect $500,000 portfolio to start with. You can go over or under a little bit if needed. Do not be too concerned on what stocks to buy or whether to include bonds or gold in your portfolio. I do not want you to start with a perfect portfolio. As we proceed through the course, you will learn and accordingly will make changes to your portfolio. Besides the Yahoo Finance website, the following web sites may be of help in the portfolio construction process:

2. Whatever changes you make, you have to explain to your instructor, why you did what you did. DO NOT take any money out or put any extra money in this investment.

3. Your activities will go on over the twelve weeks of the course and will end on week twelve of the classes. Before the final exam, I would like you to give me a synopsis of what you did in light of the lessons learnt in the class. Remember, theories are theories – they may or may not fit the reality all the time. That is exactly what the purpose of this work – for you to find out whether you can use what you learn from the books.

4. Your grade will not depend on the final value of your portfolio, rather, on your efforts in making changes and on your ability to integrate your learning with your practical experience. You also want to show me how you would start with your portfolio if you had the chance to start all over again. You also have to include a section “If I were to invest in real life”. This section will reflect your recommendations to yourself in light of your experience in the class and this project. As we proceed, I will provide you with more web sites. But the first site mentioned in this hand out has a very comprehensive list of sites that you will find helpful. Also, there are quite a few materials in the library that you can consult. Last, but not the least, I will try my level best to help you with all your theoretical needs. Dates to keep track of:

1. You should submit the initial construction of your portfolio by the [insert date], by 6:00 PM PST.

2. By the [insert date], you must submit your final report. Each student (not each group) must submit this report. This should contain at least the following elements:

  • A brief overview of your performance
  • A graph of the daily balances of your portfolio and the market index (in the same graph) (or appropriate benchmark)
  • How would you start your portfolio if you could go back the beginning and why
  • If you were to invest in real life, what advice would you have for yourself?
  • What have you learned from this assignment, or how could it have been designed better to help you learn

3. Your grades will depend on the basis of the following criteria:

  • Regularity of submission of weekly updates: 15%
  • Group discussion (on Blackboard) of portfolio ideas 15%
  • Changes reflecting new material from the week’s lesson: 40%
  • Final report 20%
  • Overall how you convince me that you learnt something 10%