Formula sheet
A | B | C | D | E | F | G | H | I |
2 | a) and b) | |||||||
3 | Total amount to invest | 100000 | ||||||
4 | ||||||||
5 | Investment | Annual Return Rate | ||||||
6 | Global current mutual fund (GF) | 0.09 | ||||||
7 | Energy Mutual Fund (EF) | 0.07 | ||||||
8 | Certificate of deposit (CD) | 0.04 | ||||||
9 | ||||||||
10 | Amount Invested | Weight in portfolio | ||||||
11 | Global current mutual fund (GF) | 20000 | =D11/$D$14 | |||||
12 | Energy Mutual Fund (EF) | 10000.0459605295 | =D12/$D$14 | |||||
13 | Certificate of deposit (CD) | 20000 | =D13/$D$14 | |||||
14 | =SUM(D11:D13) | |||||||
15 | ||||||||
16 | Constraints: | |||||||
17 | Amount invested in GF | =D11 | >= | 20000 | ||||
18 | Amount investment in EF | =D12 | <= | 30000 | ||||
19 | Amount invested in CD | =D13 | >= | =D11 | ||||
20 | Total amount invested in GF and EF as % of total investment | =(D11+D12)/D14 | <= | 0.6 | ||||
21 | Total amount invested in EF and CD as % of total investment | =(D12+D13)/D14 | >= | 0.3 | ||||
22 | Total amount invested | =D14 | <= | =D3 | ||||
23 | ||||||||
24 | Total Return | =SUMPRODUCT(D6:D8,E11:E13) | =getformula(D24) | |||||
25 | ||||||||
26 | Target Variable (Maximize total return) | |||||||
27 | Changing variable (Amount invested in each asset) | |||||||
28 | Constraints | |||||||
29 | ||||||||
30 | Using solver, amount invested in each asset can be calculated to maximize the return given the constraints. | |||||||
31 | ||||||||
32 | Thus amount to be invested in different assets are | |||||||
33 | Investment | Amount Invested | ||||||
34 | Global current mutual fund (GF) | =D11 | ||||||
35 | Energy Mutual Fund (EF) | =D12 | ||||||
36 | Certificate of deposit (CD) | =D13 | ||||||
37 |
Solver Settings
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