Question

Simone is interested in three ASX-listed healthcare companies, Cochlear Ltd. (COH.AX), Ramsay Health Care Ltd. (RHC.AX) and Ansell Ltd. (ANN.AX). Her stock broker collected their year-end adjusted closing prices between 2003 and 2018 (see ‘Stock Prices.xlsx’ in CloudDeakin ‘Assessment Resources - Group Assignment’ folder), and Simone asks you to conduct some preliminary analysis.

Use EXCEL to compute risk and return of portfolio I, II & III. Rank these investments with the f. same criteria and present it in WORD file. RHC.AX СОН.АХ ANN.AX II II Rank Expected Return E(R) Standard Deviation (o)

Answer 1

Ans. Expected Return of a stock can be calculated by averaging the returns over a period of time.

On the other hand, Risk of a stock can be measured by ascertaining its deviation from the expected return.

Therefore, the return and risk of the three stock viz., Cochlear Ltd. (COH.AX), Ramsay Health Care Ltd. (RHC.AX) and Ansell Ltd. (ANN.AX) can be calculated accordingly.