Portfolio Allocation
The preferred investment would be to invest the wealth in the weighted ratio BAJAJAUT.BO 25.00%, HDFCBANK.NS 5.95%, ITC.NS 17.56%, M&M.NS 25.00%, NTPC.NS 10.71%, Reliance.NS 15.78%.
The estimated monthly return would be close to 0.91%, with the estimated risk of 3.21%. The investment portfolio has the max Sharp ratio (4.61) for the Expected return of 15.00% annually. The investment, in this scenario for each equity, has been caped to 25.00% to avoid putting all eggs in one basket.
*The investment advice is based on mean-variance diversification, based on past three years values from publicly available information. Any losses incurred from the above advise would not account administrator or the author liable to any form of compensation. The viewer is advised to conduct his own analysis before purchasing/selling/holding of any equity mentioned above or in this blog. The Blog (Anomalies Post) has no connections with any party whatsoever.
**Assumptions:
1) Maximum investment per cent in single equity to be less than or equal to 25 per cent.
2). Risk-free rate is assumed to be minimum of the actual bank savings rate i.e. 2.5% annually.
3) The portfolio allocation has maximized Sharpe ratio.
You must log in to post a comment.