Statistic Assigment
Contents
1.0 Chapter 1-Introduction, problem statement and objectives 2 2.0 Chapter 2- Literature Review 4 3.0 Chapter 3-Methodology 7 4.0 Chapter 4- Result 8 5.0 Conclusion 9 6.0 References 10 7.0 Articles 11 8.0 Appendix 11
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Chapter 1-Introduction, problem statement and objectives
This assignment appertains to analyzing the relationship between one dependent variable with various independent variables. This assignment will be divided into 5 chapters in which each chapter individually will explain and connect various information and research in order to give readers a better idea of the outcome, which will eventually be explained in chapter 5. The variables that will be used are divided into both dependant and independent variables.
The variables are as follows; 1. dependent variable- FTSE 100 Index (Y) 2. independent variable- UK government bond market (X1), 3. independent variable- S&P 500 Index (X2) 4. Independent variable- US money exchange rate (X3).
The main focus of this assignment would be to analyze and measure the impact on the FTSE 100 Index with other independent variables as mentioned above.
Problem statement
In order to paint a better picture, we have divided the problem statements into 3; 1. Whether a relationship between the dependant and independent variables exist? 2. As to what degree or amount of influence that each independent variables have towards the dependant variables? 3. Whether the mixture of the portfolio has strong diversification effect considering the risks of each particular instrument?
Objectives
Among the objectives that this assignment aims to reach are; 1. To effectively use multicollinearity and heteroscedasticity in order to explore and investigate the correlation that the dependant and independent variables have with each other. 2. To determine which independent has most affect in manipulating the given dependant variable. 3.
1.0 Chapter 1-Introduction, problem statement and objectives 2 2.0 Chapter 2- Literature Review 4 3.0 Chapter 3-Methodology 7 4.0 Chapter 4- Result 8 5.0 Conclusion 9 6.0 References 10 7.0 Articles 11 8.0 Appendix 11
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Chapter 1-Introduction, problem statement and objectives
This assignment appertains to analyzing the relationship between one dependent variable with various independent variables. This assignment will be divided into 5 chapters in which each chapter individually will explain and connect various information and research in order to give readers a better idea of the outcome, which will eventually be explained in chapter 5. The variables that will be used are divided into both dependant and independent variables.
The variables are as follows; 1. dependent variable- FTSE 100 Index (Y) 2. independent variable- UK government bond market (X1), 3. independent variable- S&P 500 Index (X2) 4. Independent variable- US money exchange rate (X3).
The main focus of this assignment would be to analyze and measure the impact on the FTSE 100 Index with other independent variables as mentioned above.
Problem statement
In order to paint a better picture, we have divided the problem statements into 3; 1. Whether a relationship between the dependant and independent variables exist? 2. As to what degree or amount of influence that each independent variables have towards the dependant variables? 3. Whether the mixture of the portfolio has strong diversification effect considering the risks of each particular instrument?
Objectives
Among the objectives that this assignment aims to reach are; 1. To effectively use multicollinearity and heteroscedasticity in order to explore and investigate the correlation that the dependant and independent variables have with each other. 2. To determine which independent has most affect in manipulating the given dependant variable. 3.
References: 3. Curtis G, 2004, Modern Portfolio Theory and Behavioral Finance, viewed on 12 July 2012, <http://www.knightsbridgesearch.com/site/downloads/4.pdf>. 4. Fama, E and French K. 2004, Journal of Economic Perspective, The Capital Asset Pricing Model: Theory and Evidence, vol. 8 n0.3. 5. Jeshim, 2003, Multicollinearity in Regression Models, viewed on 13 July 2012, <http://sites.stat.psu.edu/~ajw13/SpecialTopics/multicollinearity.pdf> Articles