Shri Dharmasthala Manjunatheshwara Institute for Management Development Mysuru

PGDM Mid Term – Examination – July 2021 Term – IV – Batch

2020-22
Course Title: Investment Analysis and Portfolio Management

Duration: 60 minutes Max. Marks : 20

Instructions to Candidates:
1. This is an open book examination.
2. For question no.1, the answer should be brief and to the point.
3. All the questions can be answered in the excel sheet. Calculations and its interpretation
should be given wherever is necessary.

Answer ALL Questions

1. “Increase in inflation has impacted the real return on securities. In some cases, real returns have
become negative”. Elucidate in this context the type of investments/asset class which can address
negative real returns. Briefly discuss on any TWO asset classes in the given context. (5 Marks)

2. Consider the following data (closing prices) for 3 scrips, RIL Ltd, ITC Ltd and TCS Ltd on BSE
for a period of one year. (8 marks)
RIL Ltd ITC Ltd TCS Ltd
MMYYYY

July 2019 963.78 270.05 1,847.20

Aug 2019 1,174.67 245.55 1,941.25
Sep 2019 1,229.25 259.7 2,078.20
Oct 2019 1,246.34 257.55 2,184.50
Nov2019 1,051.39 246.35 1,937.60
Dec 2019 1,157.18 237.65 1,970.60
Jan 2020 1,110.48 235.25 1,893.55
Feb 2020 1,215.53 197.6 2,014.60
Mar 2020 1,219.94 172 1,984.25
April 2020 1,350.20 182.15 2,000.40
May 2020 1,378.68 197.45 2,254.95
June 2020 1,317.21 194.6 2,196.85
Calculate the portfolio risk and return for the following portfolios-
a. Portfolio comprising of RIL Ltd and ITC Ltd only (2 marks)
b. Portfolio comprising of RIL Ltd, ITC Ltd and TCS Ltd (4 marks)
c. According to you, which portfolio is better than other and why? (2 marks)

Note- The portfolio funds are divided equally amongst all component scrips.
3. The month end closing price of VRL Logistics Ltd for the period 2019-21 (Financial Year) and
corresponding BSE Sensex values are provided below. Compute the alpha (intercept), beta (slope) of
the stock and other parameters. Interpret and comment on
the results. (7 marks)
eal returns have
h can address
. (5 Marks)

TCS Ltd on BSE

ncial Year) and
t), beta (slope) of
 Close Price
MMYYYY 'BSE_SENSEX'

042019 271.85 39031.55

052019 285.5 39714.2
062019 277.85 39394.64
072019 236.75 37481.12
082019 288.2 37332.79
092019 276.8 38667.33
102019 266.5 40129.05
112019 275.1 40793.81
122019 275.2 41253.74
012020 278.75 40723.49
022020 230.9 38297.29
032020 153.7 29468.49
042020 164.15 33717.62
052020 147.3 32424.1
062020 161.55 34915.8
072020 148 37606.89
082020 164.9 38628.29
092020 165.3 38067.93
102020 149.95 39614.07
112020 179.35 44149.72
122020 202.1 47751.33
012021 194.35 46285.77
022021 258.35 49099.99
032021 230.55 49509.15