Let’s introduce risk free assets in our portfolio. Risk free assets are those which have zero risk and very small return like govt. bond. We will create a portfolio consisting both of risky and risk free assets: Modifying the weight function that we have created in portfolio optimization-I post: Using this function for our basket[…]

Instead of using OptWeights function created in last post, we will use portfolio.optim function which is present in “tseries” library to handle “short” position stocks. Therefore make sure to have “tseries” package installed before running this code: First, lets check the weights when “short” positioning of stocks are allowed: It is same to what we[…]

What is meant by portfolio optimization? Portfolio means grouping of financial assets like Bonds, stocks etc. Portfolio optimization is the process of choosing the proportions of various assets to be held in a portfolio so that with min risk one can get maximum return. Suppose we want to make a portfolio consisting of 5 tyre[…]

What is Quandl? It is a website that host data from hundreds of publishers. This site specializes in data that is collected over time and so far has data categorized as “financial, economic and social,” such as stock and commodity prices, unemployment rates, crime rates and populations. How we can fetch data from Quandl?[…]

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