Restart to return home

__
__Portfolio
Analysis

Welcome to the FTS Portfolio
Returns and Efficient Portfolio Module. This module lets you construct
portfolios and analyze their risk and return properties using real world
data sets.

To get started you can either i. link to your current course dataset, ii.
read in your own Smart Excel workbook or iii. work with the traditional
workbook. If you are using iii. it is easy to convert your workbook
into a smart workbook.

If i. click on the Data menu item at the top and follow online instructions.

If ii. first open Excel with your Workbook and then click on FindExcel
Worksheets. If you have saved it as a
smart workbook
(see the Help menu item to read how to save intial settings) you can click
OK and proceed to DataAnalysis or Portfolios.

If iii. you will need to manually enter the information into the text boxes/drop downs that are above the initialize button.

**How Do I Use this Module?
**

Portfolio analysis starts with historical data. You can input data in either prices or returns. The module then lets you apply portfolio statistics to build and test your portfolio using this data. The following three steps will let you see how.

**Aside: Input Data
Conventions:** You first set up your data for this module in an Excel
Spreadsheet (see step 1 below). *The unit of measure for the
data must be of the same across all markets.* That is, if weekly
price data is used and you want to include an index and risk free rate data,
then this too must be expressed in terms of weekly data. For example,
suppose your risk free rate data is 5% for week x, you would need to divide
this by 5200 so that 0.000962 is recorded in the appropriate spreadsheet cell.

The module assumes complete
data. The user is responsible for correcting all cells that have **missing
data** in the spreadsheet before linking to the module. The
spreadsheet link makes this simple because it lets you apply the convention of
your choice directly in Excel (e.g., use the previous observation, interpolate
between previous and next observations etc.,).

**Step 1:** You can
work through the Fast Start to Portfolio Analysis
using the data provided. This illustrates for a set of country index
funds denominated in USD and traded on the Amex Exchange, how to apply modern portfolio theory to solve real world portfolio
management problems.

**Step 2:** Getting
data from the web by clicking on the
hypertext.

**Step 3:** Work
through how do I use the portfolio management modules by clicking on the
hypertext.

**Markowitz Diversification Lesson:** For a comprehensive lesson on
how to apply this module click on Markowitz
Diversification now. Otherwise continue for a summarized overview.

OS Financial Trading System, PO Box 11356, Pittsburgh, PA 15238 USA, Phone 1-800-967-9897, Fax 1-412-967-5958, Email fts@ftsweb.com,

(C) Copyright 2000, OS Financial Trading System