Darden Capital Mangment Case Essay

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Case Analysis Worksheet This form can be used to organize your thoughts about a case. As you perform your analysis remain open to the fact that your interpretation of the facts may change and therefore you should constantly revisit your answers. Define the Problem: Describe the type of case and what problem(s) or issue(s) should be the focus for your analysis. This is a decision case. In this case, Senior Manager Steve Majocha needs to choose two or three securities for consideration as investment candidates. List any outside concepts that can be applied: Write down any principles, frameworks or theories that can be applied to this case. Correlation, Diversification, CAPM. List relevant qualitative data: evidence related to or based on the quality or character of something. Current treasury bills return is close to arithmetic mean. Group participants offer 3 possible combinations of assets: 1) Micron (greatest expected return potential, large risk), 2) Boise Cascade and New York Times (the largest Sharpe ratio), 3) Mylan Labs and Placer Dome (two assets with the largest alpha). Besides, current portfolio allocate only 17,8% into risk-free bonds. Thus, portfolio holders are relatively risk tolerant. List relevant quantitative data: evidence related to or based on the amount or number of something. S&P 500 index geometric mean 10,4, standard deviation 20,4. Treasury bills annual return is 3,8%. Beta Anticipated annual estimate return Alpha Raw Value line 1,14 1,2 10,8 -0,828 0,46 0,55 8,2 3,508 2,19 0,26 0,72 0,25 1,7 0,7 0,9 0,4 13 10,9 9 8,8 -9,338 8,248 1,656 6,25 Asset Boise Cascade Boston Beer Micron Technologies Mylan Labs New York Times Placer Dome Describe the results of your analysis: What evidence have you accumulated that supports one interpretation over another. Copyright © 2011 Harvard Business School Publishing This document is for use only

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