INVESTMENT ANALYSIS AND

PORTFOLIO MANAGEMENT
CIA 1

SUBMITTED TO: SUBMITTED BY:

DR. KAVITHA D AISHA KUKHRANIA
1828723
Stock used in the analysis:
1. Navneet education limited
2. MT Edu care limited
3. Global Education limited
4. Edu comp solutions

Time period of study:

23 Months
(Ques) Mr. Abhay, a principal of XYZ Public School, wants to invest some of
his savings in different share in education industry. He has selected 4
companies. He is confused whether to invest in one company, or make a
portfolio. He wants to invest equally on both the company if it is suggested to
be a portfolio. Calculate risk and return of individual stocks also check the
portfolio risk and return.
INDIVIDUAL STOCK OUTPUTS:
Σ𝑅𝑒𝑡𝑢𝑟𝑛𝑠
Average Returns (𝑅𝑖 ) =
𝑛

Company name Average Risks

Returns
Navneet 2.231193 7.967479
education limited

MT Edu care 1.915515 17.09661

limited

Global Education 3.650672 10.23784

limited

Edu comp 10.83704 21.907

solutions
 GLOBAL LTD.
300 30
25
250 20
200 15
10
150 5
0
100 -5
50 -10
-15
0 -20

30-Jun-18
31-Aug-17

30-Nov-17
31-Dec-17

31-Mar-18
30-Apr-18
31-May-18

31-Aug-18

30-Nov-18
31-Dec-18

31-Mar-19
30-Apr-19
31-May-19
31-Oct-17
30-Sep-17

31-Jan-18
28-Feb-18

30-Sep-18

31-Jan-19
31-Oct-18

28-Feb-19
31-Jul-17

31-Jul-18
Close Price RETURNS

MT EDU CARE
100 40
90
30
80
70 20
60 10
50
40 0
30 -10
20
-20
10
0 -30

Close Price Returns

NAVNET EDU LTD.

200 25
180 20
160 15
140 10
120 5
100 0
80 -5
60 -10
40 -15
20 -20
0 -25

Close Price RETURNS

 EDU COM LTD
10 50
9 40
8 30
7 20
6 10
0
5
-10
4 -20
3 -30
2 -40
1 -50
0 -60

30-Jun-18

31-Dec-18
31-Aug-17

30-Nov-17
31-Dec-17

28-Feb-18
31-Mar-18
30-Apr-18
31-May-18

31-Aug-18
30-Sep-18

30-Nov-18

31-Mar-19
30-Apr-19
31-May-19
30-Sep-17

31-Jan-18

31-Jan-19
31-Oct-17

31-Oct-18

28-Feb-19
31-Jul-17

31-Jul-18
Close Price Returns

Analysis: It is suggested that Mr. Abhay should invest in Navneet education

limited. Navneet education limited has decent returns and comparatively least
risk among the stocks. All others have great returns but at the same time the risk
is very high.

PORTFOLIO ANALYSIS:
Calculation methodology:

Portfolio Return (𝑅𝑝 ) = Σ𝑊𝑖 ∗ 𝑅𝑖

̅̅̅̅)∗(𝑅2−𝑅2
Σ(𝑅1−𝑅1 ̅̅̅̅)
Co-variance =
𝑛

𝐶𝑜𝑣𝑎𝑟𝑖𝑎𝑛𝑐𝑒 1,2
Correlation (𝑟12 ) =
𝜎1 ∗ 𝜎2

Portfolio Risk = √(𝜎12 ∗ 𝑤12 ) + (𝜎22 ∗ 𝑤22 ) + (2 ∗ 𝑤1 ∗ 𝑤2 ) ∗ (𝑟12 ∗ 𝜎1 ∗ 𝜎2 )

Portfolio Stocks:

COMBINATIONS NAVNET and MTEDUCA and GLOBALA AND

MTEDUCA GLOBALA EDU COMP

COVARIANCE 1.29472 -0.8908 0.567401

CORRELATION 0.009505 -0.00509 1.214128

RISK 2.629331 9.862685 16.80283

PORTFOLIO ANALYSIS
NAVNET and MTEDUCA MTEDUCA and GLOBALA GLOBALA and Educomp

18
16
14
12
10
8
6
4
2
0
COVARIANCE CORRELATION RISK
-2

If looking at the portfolio, Mr. Abhay can go with MTEDUCA and GLOBALA
as it has negative correlation, but on the same hand the risk is very high with
9.8%.

But overall, Mr. Abhay is suggested to invest in Navneet education limited

rather going for the portfolio which has more risk that individual risk, and the
returns are almost same.