You will need to submit a word file where you answer all of these questions and an excel file where you show the calculations. In the excel sheet, you should have a separate sheet for each question.
- Choose two publicly trading banks. What are their ticker symbols? What are their Central Index Keys (CIK)? Explain what a ticker is and what a CIK is. Describe the two banks briefly in about 300 words for each bank.
- Track the daily stock price from January 1, 2018, to December 31, 2020. You can get this data from https://finance.yahoo.com/ (Links to an external site.)
(i) Plot the graph and identify sudden increases and decreases to the stock price. Use the adjusted close price. Also, explain why using the adjusted stock price is better than simply the stock price.
(ii) Calculate the percentage change in stock price for each stock for each day and plot a graph.
(iii) What was the day the price went down the most? Why did it go down? Link it to some news about the economy or the bank. [Hint: Did the perceived risk of the bank go up, or did its expected revenue go down?]
(iv)What was the day the price went up the most? Why did it go up? Link it to some news about the economy or the bank. Why?
(v) Calculate the standard deviation of the adjusted stock price for this period (January 1, 2018, to December 31, 2020). There is no need to calculate the rolling standard deviation.
- What are the Betas of the stock based on https://finance.yahoo.com/ (Links to an external site.)? Calculate the Beta for each of these stocks on your own [You will need to download the data of “Index Funds S&P 500 Equal Weight No Load Shares (INDEX)” from yahoo finance. Compare the Beta you calculated with Beta for the two banks you found from https://finance.yahoo.com . (Links to an external site.)Are they close? Why aren’t they the same? What does the Beta of the stock mean? Based on the comparison of the Beta for the two banks, what can you say about their riskiness? Which bank is riskier?
- Obtain their financial statement (balance sheet, income statement, and cash flow statement) and put it on an excel file. You should have the data for the years 2018, 2019, and 2020. You can get it from gov/edgar/search-and-access” rel=”noreferrer noopener” target=”_blank”>https://www.sec.gov/edgar/search-and-access (Links to an external site.). You will have to spend some time on the website to figure out how to get the financial statement. You can watch the video I have posted. It may save you some time. You can get it from another source if you wish, but please mention the source in the excel file.
5. In the year 2020, discuss which bank managed tax better and which one managed their assets better.
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