Choose four companies listed on the Australian Stock Exchange from Yahoo Finance and collect the following data for these companies on a monthly basis for the period January 2013 to the December 2015:
(i) Closing share prices,
(iii) closing values of S&P/ASX 200 index, and
(iv) data on the risk-free rate of return in Australia. Please note that you need to obtain unadjusted shares prices for the companies selected and unadjusted values for the S&P/ASX 200 index. The companies chosen should have been traded in all months during the above period.
Using the above data, perform the following tasks:
1. Compute monthly holding period returns (HPRs) for the companies and for the market
2. Compute average HPRs with and without compounding for the companies and for the market and compare the returns.
3. Compute annualised HPRs for the companies and for the market with and without compounding using the figures you computed in (2) above.
4. Compute standard deviation of share returns for the companies and for the market and comment on the standard deviations