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Journal 2 Investment Analysis

The student analyzed the average returns of their portfolio using arithmetic and geometric mean returns since they only had $233 cash left and did not want to sell stocks that were currently dropping in price and value. The results showed slight differences between the two averages, indicating little price fluctuation over the 11 day period analyzed for 10 stocks in the portfolio. However, the student noted this was not an accurate analysis due to the very small time range of the data.

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Yolanda Primrosa Nurhan
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42 views1 page

Journal 2 Investment Analysis

The student analyzed the average returns of their portfolio using arithmetic and geometric mean returns since they only had $233 cash left and did not want to sell stocks that were currently dropping in price and value. The results showed slight differences between the two averages, indicating little price fluctuation over the 11 day period analyzed for 10 stocks in the portfolio. However, the student noted this was not an accurate analysis due to the very small time range of the data.

Uploaded by

Yolanda Primrosa Nurhan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Yolanda Primrosa Nurhan

201700212

Journal 2 Investment Analysis

I used the arithmetic average return and the geometric mean return to analyze the
average returns of my portfolio. I can’t make any more transactions because I only have $233
cash left on my account. And I don’t want to sell any of my stocks because it’s currently
dropping, the price is currently low. And so I analyze the average return of my portfolio instead.
The data that I used was the closing prices of the stocks from 30 January 2018, which was the
day I bought the socks, until 9 February 2018. These are the result:

Stock Code Arithmetic Average Geometric Mean Delta Percentage


AAPL -0.78% -0.72% 0.06%
JJSF -0.45% -0.42% 0.04%
FB -0.71% -0.67% 0.04%
SBUX -0.57% -0.52% 0.06%
INTC -1.27% -1.15% 0.11%
CSCO -0.79% -0.74% 0.05%
MRK -1.23% -1.11% 0.12%
EXEL -0.91% -0.86% 0.05%
TSN -0.64% -0.58% 0.06%
NFLX -1.33% -1.23% 0.11%

What I can see from the results is that there are only a slight difference between
arithmetic average and geometric average. It means that there are not much price fluctuation
within those 11 days. But this analysis is not accurate because the time range are very small
and we can’t really draw a conclusion based on just these data.

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