ACC2005: Every Student will be Assigned to a Stock listed in the Singapore Stock Exchange :Investment Analysis Assignment, SIT, Singapore

1. General Information: This is an individual assignment. Every student will be assigned to a stock listed in the Singapore Stock Exchange and be required to produce a 2-page investment analyst’s report on the stock.

Although this is an individual report, it is meant to supplement the tasks to be performed for your group assignment – Applied Simulation Trading Challenge. In particular, the expected learning outcomes are:

• The ability to perform a security selection for your investment portfolio;
• The ability to use online resources to analyze a stock;
• The ability to make use of a statistical package to perform econometric testings (such as regressions) and making inferences.

2. Porter’s Five Forces: You are to investigate a stock that is assigned to you. You can locate the ticker of the stock assigned to you via the “Grades” within the ACC2005 Investment Analysis’s xSITe. All students are assigned to a different stock. There are five forces that determine the attractiveness of an industry. Research and report on the fundamental factors of the industry/sector of your stock.

3. EVIEWs Competency: Collect and verify the following company’s financial statement data for the past 10 years (2010 to 2019) from the online resources at the highest frequency you can
observe.

• Market Index: STI index (for SG stock)
• Total Assets
• Total Liabilities
• Total Equity
• CPI (SG)
• Risk-free rate (3 months Treasury bill for the US or Singapore Government Security)

You are to investigate a stock that will be assigned to you in the context of a multifactor model. The model can be written as:
𝒓𝒊,𝒕 − 𝒓𝒇,𝒕 = 𝜶 + 𝜷𝟏(𝒓𝒎,𝒕−𝟏 − 𝒓𝒇,𝒕−𝟏) + 𝜷𝟐(𝒓𝒊,𝒕−𝟏 − 𝒓𝒇,𝒕−𝟏) + 𝜷𝟑𝑺𝒊𝒛𝒆𝒕−𝟏 + 𝜷𝟒𝑳𝒆𝒗𝒕−𝟏 + 𝜷𝟓𝑪𝑷𝑰𝒕−𝟏 + 𝒆𝒕
Where 𝒓𝒊,𝒕 is the quarterly/semi-annual/annual return of company i’s stock; 𝒓𝒇,𝒕 is the risk-free rate; 𝒓𝒎,𝒕 is the market return; 𝑺𝒊𝒛𝒆𝒕 is the logarithm of the Total Asset (quarterly/semi-annual/annual) of the company; 𝑳𝒆𝒗𝒕 is the leverage of the company calculated as the Total Liability (quarterly) over the Total Equity of the company; CPI is the Consumer Price Index; t denotes the quarter/semi-annual/annual point of time; e is the error term. Run a least-squares regression using the above multifactor regression equation in Eviews.

Interpret the estimated coefficients and any inferences you can conclude from your regression results. You must include your original data and the reviews’ regression results in the appendix of your report. Failure to do so will result in a zero mark awarded to you.