Final Project and Presentation

Business Finance
FINC 2101
Fall 2021

 This is a group project, please work as a group of maximum four students.

Please note that you will prepare 2 documents, a research paper with the
EXCEL sheets and a PowerPoint presentation. While the paper will
receive the same grade for all group members, for the presentation each
student will be graded on an individual basis based on his/her ability to
answer questions and present (15%+5%for the presentation).
 You can start to work on the research after we have finished the three
building blocks
 Deadline for submission of the paper as a word document on Turnitin is 5th
of December 2021.
 The presentation (PowerPoint or video or Prezi …etc.) will be on the 8th
and 12th of December. As we can only have 4-5 presentations per class
please note that you will need to register the date of your presentations
with Wesam Sherif and we will apply the first come first served approach.
Each presentation will take 10 minutes, and 5minutes for Q and A. Each
member of the group will be required to present and to answer questions.
Your ability to work as a team is part of the assessment.
 All the data you will work on is downloadable from
https://finance.yahoo.com/
 Please also note that you can get BLOOMBERG DATA from the financial
center at AUC, and make sure to use the AUC online library as well.
 Please note that Wesam and I will always be glad to help and assist in all
the steps of your research.

Topic 1: Diversification is an essential concept and important rule of finance. In

your presentation prepare a brief literature review on the concept and
importance of diversification in Finance. In your application calculate the
return, standard deviation and CV of twenty stocks, then create at least 20
portfolios , portfolio one will include two stocks , then the second you will add
another stock so the portfolio will include 3 stocks ,then portfolio 3 will include
4 stocks then 5,6,7,8,9,10,11,12,13,14,15,16,17,18,19…..all 20 stocks (use
equal weights).Show how standard deviation decreases on average when we add
more stocks to the portfolio. What is the risk and return and coefficient of
1/1
variation of each of the portfolios, compare them and comment your results and
compare it with the theoretical review in the beginning of the paper. End your
paper with the lessons learned from this exercise and your conclusion?

Topic 2: Stock Valuation models are essential to facilitate decision making and
portfolio selection in Finance. In your literature review briefly explain the
importance of stock valuation, and the different types of models that you know.
In the application part compare two sectors (5-10 stocks for each sector) in
terms of their risk, return, coefficient of variation and beta. Compare the
performance of both sectors in 2020-2021 compared to 2019-2020(monthly
return -annual return) . Explain the main reasons for the upward or downward
trends that you see.

Topic 3: Review the literature to explain the main determinants that determine
the IPO price. Choose 10-20 recent IPOs (that occurred within the last five
years) and monitor the price and daily return over one year from the date of
issuance. Show whether the IPO price is undervalued or overvalued and explain
the difference of the monthly /six months/ and annual return in comparison with
the market index monthly /six months and annual return

2/1