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c      | |  |The Beta coefficient of a security, fund, or portfolio represents its market sensitivity, relative to a given market index and time period. In the case of our assignment the first stock that I chose was APL (Attock Petroleum Limited) and the relevant market index was the KSE100 index. The time period that we were expected to focus on was from January 2009 to September 2010. The beta (ȕ) calculation of Attock petroleum limited revealed that the Beta Coefficient was 0.536309023. This implies that the relative movements or risk of APL is almost half of the relative movements of the average risk stock (KSE100-index). Œ   |it is a statistical measure of how well a regression line approximates real data points. It is a descriptive measure between 0 and 1 indicating how good one term is at predicting another. It gives a measure of the goodness of fit. As Attock Petroleum has an R Square of 0.177690258281476 it implies that the approximate fit is around 17.7% of the data which is a measure used to predict the trend of the data.  |Œ is the correlation coefficient which can assume values between 0 and 1. It measures the degree to which 2 or more X variables are related to the dependent Y variable. It is also the square root of R2. The Multiple R for Attock Petroleum is 0.421533223223836. The positive coefficient of this variables shows that the relationship of this stock and the market index is positive. If the market moves up, the stock will follow and vice versa. The magnitude of this variable shows the strength of the relationship. A result of less than 1 would suggest that when the market fluctuates, the stock will fluctuate by a lower percentage in the direction of the market. This means that the stock is less risky than the market.   |  Standard Error or the standard error of the mean of multiple samples is the standard deviation of the sample means and thus gives a measure of their spread. The smaller the standard error the less the spread and the more likely it is that any sample mean is close to the population mean. Attock Petroleum has a standard error of 0.040505712249691 which means that the spread of the returns from the average expected returns is minimal, hence reducing the riskiness of the stock. Attock Petroleum has an average weekly return of 0.009237524 which can be seen as a pisitve sign as it positive, however the magnitude of the result is still relatively weak. It also has a 4.4% chance of deviating from the expected average return a      | |  The beta (ȕ) calculation for Shell Pakistan revealed that the Beta Coefficient was 0.885518507. This means that the stock will move up and down with the broad market averages and it will be almost as risky as the average risk stock (KSE-100 index). Moreover, it will be a little less risky than the market risk since the Beta (ȕ) is a little less than 1. Œ|  it is a statistical measure of how well a regression line approximates real data points. The R Square for Shell Pakistan is 0.237449947921922, which means that the approximate fit is 23.7% of the model which as a measure can be used to predict the trend of the data.  |Œ is the correlation coefficient which can assume values between 0 and 1. It measures the degree to which 2 or more X variables are related to the dependent Y variable. It is also the square root of R2. The Multiple R for Shell Pakistan is 0.487288362186008. The positive coefficient of this variables shows that the relationship of this stock and the market index is positive. If the market moves up, the Shell Pakistan¶s stock will follow and vice versa. The magnitude of this variable displays the strength of the relationship. A result of less than 1 suggests that when the market fluctuates, the stock will fluctuate by a lower percentage in the direction of the market. This means that the stock is less risky than the market.   |  or the standard error of the mean of multiple samples is the standard deviation of the sample means and thus gives a measure of their spread. The smaller the standard error the less the spread and the more likely it is that any sample mean is close to the population mean. Data for Shell Pakistan has a standard error of 0.0557135768825044 which means that the spread of the returns from the average expected returns is low, hence reducing the riskiness of the stock. Shell Pakistan has an average weekly return of -0.002760064, which makes it uneasy for prospect investors to be sure of the returns. Also it has a 6.3% chance of deviating from this expected average return. This means that it has a chance of going into further negative which means that it constitutes more insecurity. However it can also go more positive.   c  | |  When the two-stock portfolio is considered taking the probability of each stock as 0.5, we arrive at the Beta Value of 0.710913765. This means that the stock will move up and down with the broad market averages and it will be less risky than the average risk stock (KSE-100 index). It is however still close to 1 which should be a statistic that should be taken into consideration. Œ|  is a statistical measure of how well a regression line approximates real data points. It is a descriptive measure between 0 and 1 indicating how good one term is at predicting another. The R Square for the portfolio is 0.000192718857209933, which means that the approximate fit is 1.9% of the model, which as a measure can be used to predict the trend of the data.  |Œ The multiple R for the portfolio is 0.0138823217514194. The positive coefficient of this variable shows that the relationship of this portfolio and the market index is positive. That is, if the market moves up, the portfolio will follow and vice versa. The magnitude of this variable shows the strength of the relationship. If the market fluctuates by 1 percent, the portfolio will fluctuate by a considerably lower percentage in the direction of the market.   |  |or the standard error of the mean of multiple samples is the standard deviation of the sample means and thus gives a measure of their spread. The smaller the standard error the less the spread and the more likely it is that any sample mean is close to the population mean. The portfolio has a standard error of 0.0454890485375405 which means that the spread of the returns from the average expected returns is less, hence reducing the riskiness of the portfolio. The portfolio has an average weekly return of 0.00323873, which will not be attractive to potential rational investors. Moreover, it has a 4.5% chance of deviating from this expected average return. This means that it has a small chance of going into further negative or further positive. We can observe that a lot of risk and volatility has been taken off from the individual stocks serving the purpose that a portfolio serves.             c     a   a  c   a   a