SOUTHWESTERN ADVENTIST UNIVERSITY

100 WEST HILLCREST, KEENE, TX.

Post Course Assignment

Accenture and Lockheed Martin a Financial
Management Portfolio

Course:
BUAD521: Financial Management

Presented to:
Radhames A Lizardo, Ph.D,CPA

By:
Mark Samraj

Date:
August 15th, 2010
Introduction
This project is on Google and Tata motors in the analysis of the portfolio performance of these
two companies.

Accenture plc.
Profile
1 Grand Canal Square
Grand Canal Harbor
Dublin, 2
Ireland
Phone: 353 1 646 2000
Fax: 353 1 646 2020
Index Membership: N/A
Sector: Services
Industry: Management Services
Full Time Employees: 190,000

Accenture plc. operates as a management consulting, technology services, and outsourcing

company. Its management consulting services include customer relationship management,

finance and performance management, talent and organization performance, process and

innovation performance, strategy, and supply chain management services. The company also

provides various system integration consulting services, including enterprise solutions and

enterprise resource planning, industry and functional solutions, information management

services, service-oriented architecture, custom solutions, software as a service, mobility

solutions, and business solutions based on Microsoft Windows Server and other .NET

technologies; technology consulting (IT) services consisting of IT strategy and transformation,

enterprise architecture, infrastructure consulting, IT security consulting, application portfolio

optimization and renewal, digital solutions, and research and development; and IT outsourcing

services comprising application outsourcing services, such as application testing, application

management of enterprise-wide software programs and capacity services, and application

enhancement and development; infrastructure outsourcing services, including IT spend

management, data center, service desk, security and network, and workplace services. In

addition, it offers business process outsourcing services for specific business functions and/or

processes, including finance and accounting, human resources, learning, procurement and

customer contact, as well as various transaction-processing services comprising Internet

reservations, airport check-in, revenue management and accounting, crew scheduling and

management, and disruption recovery. Accenture plc primarily serves the communications,

electronics, high technology, media, and entertainment industries in the Americas, Europe, the

Middle East, Africa, and the Asia Pacific. The company was founded in 1995 and is based in

Dublin, Ireland.

Lockheed Martin Corporation (LMT)

6801 Rockledge Drive
Bethesda, MD 20817
United States
Phone: 301-897-6000
Fax: 301-897-6919

Index Membership: S&P 100

S&P 500
S&P 1500 Super Comp
Sector: Industrial Goods
Industry: Aerospace/Defense Products & Services
Full Time Employees: 140,000

Lockheed Martin Corporation engages in the research, design, development, manufacture,

integration, operation, and sustainment of advanced technology systems and products in the

United States and internationally. The company also provides management, engineering,

technical, scientific, logistic, and information services. It operates in four segments: Aeronautics,

Electronic Systems, Information Systems & Global Services (IS&GS), and Space Systems. The

Aeronautics segment provides military aircraft, including combat and air mobility aircraft,
unmanned air vehicles, and related technologies. Its products and programs include the F-35

Lightning II Joint Strike Fighter-multi-role coalition fighter, the F-22 Raptor-air dominance

attack and multi-mission stealth fighter, the F-16 Fighting Falcon-multi-role fighter, the C-130J

Super Hercules tactical transport aircraft, and the C-5M Super Galaxy strategic airlift aircraft.

This segment also supports P-3 Orion maritime patrol aircraft and U-2 Dragon Lady high-

altitude reconnaissance aircraft. The Electronic Systems segment offers air and missile defense;

tactical missiles; weapon fire control systems; surface ship and submarine combat systems; anti-

submarine and undersea warfare systems; land, sea-based, and airborne radars; surveillance and

reconnaissance systems; simulation and training systems; and integrated logistics and

sustainment services. The IS&GS segment provides federal services; information technology

solutions; software and systems engineering support services; logistics, mission operations

support, peacekeeping, and nation-building services for the various U.S. defense and civil

government agencies. The Space Systems segment produces government and commercial

satellites; strategic and defensive missile systems, including missile defense technologies and

systems, and fleet ballistic missiles; and space transportation systems. Lockheed Martin

Corporation was founded in 1909 and is based in Bethesda, Maryland.

Reasons for Choosing these Companies

I have chosen Accenture since it is a management consulting, technology services, and

outsourcing company. Its management consulting services include customer relationship

management, finance and performance management, talent and organization performance,

process and innovation performance, strategy, and supply chain management services. On a

personal front since Tiger Woods was its brand ambassador, and the company stood with him

despite his recent stories. I have chosen Lockheed Martin since it engages in the research,
design, development, manufacture, integration, operation, and sustainment of advanced

technology systems and products in the United States and internationally.

Company’s Mission Statement and Financial Strategies

Accenture’s mission statement is to become one of the world's leading companies, bringing

innovations to improve the way the world works and lives. 

Accenture’s six core values form the backbone of how we go to market. 

Client Value Creation - Understand and meet client expectations 100% of the time 

One Global Network - Act to enhance the collective values of the global organization while

sustaining local culture 

Integrity - Always act with openness and honesty 

Stewardship - Think future oriented; act and invest to build a stronger firm for tomorrow 

Best People - Are highly competent and make a commitment to excellence, teamwork, and the

success of our clients 

Respect for the Individual - Treat each person as we would like to be treated 

Accenture's mission is to become one of the world's leading companies, bringing innovations to

improve the way the world works and lives. 

Our six core values form the backbone of how we go to market. 

Client Value Creation - Understand and meet client expectations 100% of the time 

One Global Network - Act to enhance the collective values of the global organization while

sustaining local culture 

Integrity - Always act with openness and honesty 

Stewardship - Think future oriented; act and invest to build a stronger firm for tomorrow 

Best People - Are highly competent and make a commitment to excellence, teamwork, and the
success of our clients 

Respect for the Individual - Treat each person as we would like to be treated 

Accenture is expanding its business to different types of business so as to suite the customers the

best. Accenture maintains that diversifying its business operations would increase revenue as

well as Market Value added.

The Mission statementof Lockheed Martin is a diversified technology company serving the

needs of the government and military and selected international customers.

Values

 Customer focus

 Learning culture through integrated diversity

 Employee satisfaction

 Decisive and expeditious implementation

 Change propensity

 Continuous communications

 Mission success

 Shared vision through ethics and teamwork

Lockheed Martin USES E-BUSINESS STRATEGY TO STREAMLINE CONTRACTING

PROCESS, and also Lockheed Martin is aligning Logistics career development to their

corporate business strategy. Lockheed Martin is eyeing missile sales to the Middle East is a

new strategy to increase revenue.

Evaluation of its operating Activities

MVA/EVA
Accenture

MVA JULY 16,2010

1 RECENT PRICE 39.64

2 COMMON SHARES OUTSTANDING (Mil) 17.00

3 (1X2) MARKET VALUE OF EQUITY (Mil) 673.88

4 BOOK VALUE PER SHARE 10.86

5 (2X4) BOOK VALUE OF COMMON EQUITY (Mil) 10.370

6 (3-5) MVA (Mil) 663.510

EVA DECEMBER 31, 2009

7 EBIT (Mil) 2,691.857

8 TAX RATE 739.59 ÷ 2,691 27%

9 (1-T) 73%
10 (7 x 9) NOPAT = EBIT(1 - T) (Mil) 1,952.031

11 20 INVESTOR-SUPPLIED OPERATING CAPITAL 3,849.497

12 WACC (ESTIMATED) 8%

13 (11X12) DOLLAR COST OF CAPITAL 308

14 (10 - 13) EVA 1,644

15 NOTES PAYABLE (Mil) 955

17 PREFERRED STOCK 0
18 COMMON EQUITY (Mil) 2,887
19 SHORT-TERM INVESTMENT (Mil) 7.904
20 INVESTOR-SUPPLIED OPERATING CAPITAL 3,849.497
VALUATION MEASURES

Market Cap (intraday)5: 24.73B TRADING INFORMATION  

Enterprise Value (Aug 15, Stock Price History
20.41B
2010)3: Beta: 0.65
Trailing P/E (ttm, intraday): 16.30 52-Week Change3: 7.56%
Forward P/E (fye Aug 31, S&P500 52-Week Change3: 7.49%
13.35
2011)1: 52-Week High (Apr 23, 2010)3: 44.67
PEG Ratio (5 yr expected): 1.20 52-Week Low (May 6, 2010)3: 17.74
Price/Sales (ttm): 1.10 50-Day Moving Average3: 39.54
Price/Book (mrq): 8.38 200-Day Moving Average3: 40.48
Enterprise Value/Revenue
0.90 Share Statistics
(ttm)3:
AvgVol (3 month)3: 5,316,260
Enterprise Value/EBITDA
6.07 AvgVol (10 day)3: 3,336,070
(ttm)3:
5
Shares Outstanding : 636.52M
FINANCIAL HIGHLIGHTS  
Float: 632.58M
Fiscal Year % Held by Insiders : 1
0.13%
Fiscal Year Ends: Aug 31 % Held by Institutions1: 79.80%
May 31, Shares Short (as of Jul 30,
Most Recent Quarter (mrq): 8.14M
2010 2010)3:
Profitability Short Ratio (as of Jul 30,
1.90
Profit Margin (ttm): 6.98% 2010)3:
Operating Margin (ttm): 12.68% Short % of Float (as of Jul 30,
N/A
2010)3:
Management Effectiveness
Shares Short (prior month)3: 7.11M
Return on Assets (ttm): 15.19%
Return on Equity (ttm): 53.48% Dividends & Splits
Forward Annual Dividend
Income Statement 0.75
Rate4:
Revenue (ttm): 22.77B
Forward Annual Dividend
Revenue Per Share (ttm): 35.89 1.90%
Yield4:
Qtrly Revenue Growth (yoy): 7.90% Trailing Annual Dividend
Gross Profit (ttm): 6.84B 1.13
Yield3:
EBITDA (ttm): 3.36B Trailing Annual Dividend
2.90%
Net Income Avl to Common 1.59B Yield3:
 (ttm): 5 Year Average Dividend
N/A
Diluted EPS (ttm): 2.38 Yield4:
Qtrly Earnings Growth (yoy): 10.50% Payout Ratio4: 47.00%
Balance Sheet May 13,
Dividend Date3:
2010
Total Cash (mrq): 4.32B
Apr 14,
Total Cash Per Share (mrq): 6.79 Ex-Dividend Date4:
2010
Total Debt (mrq): 771.00K
Last Split Factor (new per
Total Debt/Equity (mrq): N/A N/A
old)2:
Current Ratio (mrq): 1.52 Last Split Date3: N/A
Book Value Per Share (mrq): 4.71
Cash Flow Statement
Operating Cash Flow (ttm): 2.89B
Levered Free Cash Flow (ttm): 2.07B
Both the Stocks and of ACN and LMT commove along with the S&P 500 and we can see both

stocks commoving with the drop of the Market. It has suffered a bit with the down fall of the

Market. The two companies have a correlation of positive correlation of .35. this can be seen in

the Graph. The Economic Value added for Accenture is 1,644 million dollars and the MVA is

663.510 Million dollars. Accenture has the following percentagesProfit Margin 6.98%,

Operating Margin 2.68%, Return on Assets 15.19%, Return on Equity 3.48%Diluted EPS 2.38,

Beta:0.65 and average trading of 5,316,260.

Interpretation of Beta

Regression Analysis betweenACNand the S&P

SUMMARY OUTPUT

Regression Statistics
Multiple R 0.57526
R Square 0.33092
Adjusted R Square
0.31958
Standard Error 0.04933
Observations 61

ANOVA
df SS MS F Significance F
Regression 1 0.07102 0.07102 29.181 1.2E-06
Residual 59 0.1436 0.00243
Total 60 0.21462

Coefficients
Standard Error t Stat P-value Lower 95%Upper 95%
Lower 95.0%
Upper 95.0%
Intercept 0.01224 0.00632 1.93704 0.05753 -0.0004 0.02488 -0.0004 0.02488
RS&P 0.71384 0.13214 5.40194 1.2E-06 0.44942 0.97825 0.44942 0.97825

The Beta for Accenture and the S&P is .71384 which shows that it is less risky than the market.

In Finance, r-squared measures how well the Capital Asset Pricing Model predicts the actual

performance of an investment or portfolio Statistical measure of how well a regression line

approximates real data points; an r-squared of 1.0 (100%) indicates a perfect fit. The formula for

r is:

R(X, Y) = [Cov(X, Y)] / [StdDev(X) x StdDev(Y) ] R Square of the given analysis is .33,

which shows that it is 33% chance of it being accurate. The p value is .05753, then results that

are only 5% likely, given that the null hypothesis is true.

T Stat measure of the statistical significance of an independent variable b in explaining the

dependent variable y. It is determined by dividing the estimated regression coefficient b by its

standard error SB. That is

Thus, the t-statistic measures how many standard errors the coefficient is away from zero.

Generally, any t-value greater than +2 or less than - 2 is acceptable. The higher the t-value, the

greater the confidence we have in the coefficient as a predictor. Low t-values are indications of

low reliability of the predictive power of that coefficient. The confidence level is .44942 to .

97825

Regression Analysis betweenLMTand the S&P

SUMMARY OUTPUT

Regression Statistics
Multiple R 0.71286
R Square 0.50817
Adjusted R Square
0.49983
Standard Error 0.04991
Observations 61

ANOVA
df SS MS F Significance F
Regression 1 0.15188 0.15188 60.9593 1.2E-10
Residual 59 0.147 0.00249
Total 60 0.29887

Coefficients
Standard Error t Stat P-value Lower 95%Upper 95%
Lower 95.0%
Upper 95.0%
Intercept 0.00781 0.00639 1.22184 0.22663 -0.00498 0.0206 -0.00498 0.0206
RS&P 1.04386 0.1337 7.80764 1.2E-10 0.77634 1.31139 0.77634 1.31139

The Beta for LMT and the S&P is .1.04386 which shows that it is more risky than the market. R

square in Finance, r-squared measures how well the Capital Asset Pricing Model predicts the

actual performance of an investment or portfolioStatistical measure of how well a regression line

approximates real data points; an r-squared of 1.0 (100%) indicates a perfect fit. The formula for

r is:

r(X, Y) = [ Cov(X,Y) ] / [ StdDev(X) x StdDev(Y) ] R Square of the given analysis is .

508172, which shows that it is 50% chance of it being accurate. The p value is .22663, then

results that are only 22% likely, given that the null hypothesis is true.

T stat measure of the statistical significance of an independent variable b in explaining the

dependent variable y. It is determined by dividing the estimated regression coefficient b by its

standard error SB. That is

Thus, the t-statistic measures how many standard errors the coefficient is away from zero.

Generally, any t-value greater than +2 or less than - 2 is acceptable. The higher the t-value, the
greater the confidence we have in the coefficient as a predictor. Low t-values are indications of

low reliability of the predictive power of that coefficient.The Confidence level is .77634 to

1.31139.

Calculation of Stock holder’s required rate of return.

CAPM=Rrf+(Rm-Rrf)Beta
Rrf 2.50%
Rm -1.43
Beta (Acn) 0.7138
Beta (Ltm) 4
1.0438 Rounded
-6
CAPM Accenture to 0
CAPM LMT -0.30537 0
1.60239

Due to very insignificant values of CAPM the figures are rounded up to 0

I’m adding another company to the financial Management Portfolio which would be Lockheed

Martin

MVA/EVA
Lockheed Martin (LMT)

MVA JULY 16,2010

1 RECENT PRICE 73.7

2 COMMON SHARES OUTSTANDING (Mil) 371.00

3 (1X2) MARKET VALUE OF EQUITY (Mil) 27,342.70

4 BOOK VALUE PER SHARE 10.86

5 (2X4) BOOK VALUE OF COMMON EQUITY (Mil) 4,029

6 (3-5) MVA (Mil) 23,314

EVA DECEMBER 31, 2009

7 EBIT (Mil) 4,589

8 TAX RATE 1260 ÷ 4,284 29%

9 (1-T) 71%
10 (7 x 9) NOPAT = EBIT(1 - T) (Mil) 3,239

11 20 INVESTOR-SUPPLIED OPERATING CAPITAL 9,181

12 WACC (ESTIMATED) 8%

13 (11X12) DOLLAR COST OF CAPITAL 734

14 (10 - 13) EVA 2,505

15 NOTES PAYABLE (Mil) 5,052

17 PREFERRED STOCK 0
18 COMMON EQUITY (Mil) 4,129
19 SHORT-TERM INVESTMENT (Mil) 0
20 INVESTOR-SUPPLIED OPERATING CAPITAL 9,181
The Market Value added for Lockheed Martin is 23,314 million and the Economic Value added

is 2,505 million.

Accentur RACC RLM

Date e LMT S&P N T RS&P
1030.7
6/1/2010 38.65 74.5 1 3.01% -6.78% -5.39%
1089.4 -
5/3/2010 37.52 79.92 1 14.02% -5.11% -8.20%
1186.6
4/1/2010 43.64 84.22 9 4.93% 2.01% 1.48%
1169.4
3/1/2010 41.59 82.56 3 4.97% 7.01% 5.88%
1104.4
2/1/2010 39.62 77.15 9 -2.49% 5.21% 2.85%
1073.8
1/4/2010 40.63 73.33 7 -1.24% -1.11% -3.70%
12/1/2009 41.14 74.15 1115.1 1.13% -2.43% 1.78%
1095.6 13.18
11/2/2009 40.68 76 3 10.66% % 5.74%
-
1036.1 11.90
10/1/2009 36.76 67.15 9 1.43% % -1.98%
1057.0
9/1/2009 36.24 76.22 8 12.93% 4.14% 3.57%
1020.6
8/3/2009 32.09 73.19 2 -5.89% 1.05% 3.36%
7/1/2009 34.1 72.43 987.48 4.79% -7.30% 7.41%
6/1/2009 32.54 78.13 919.32 11.78% -3.57% 0.02%
5/1/2009 29.11 81.02 919.14 1.71% 7.24% 5.31%
13.76
4/1/2009 28.62 75.55 872.81 7.07% % 9.39%
3/2/2009 26.73 66.41 797.87 -5.85% 9.39% 8.54%
- -
22.45 10.99
2/2/2009 28.39 60.71 735.09 -7.49% % %
1/2/2009 30.69 78.29 825.88 -3.76% -2.42% -8.57%
12/1/2008 31.89 80.23 903.25 5.84% 9.04% 0.78%
11/3/2008 30.13 73.58 896.24 -6.25% -8.63% -7.48%
- -
- 22.45 16.94
10/1/2008 32.14 80.53 968.75 11.63% % %
9/2/2008 36.37 103.84 1166.3 -8.13% -5.81% -9.08%
 6
1282.8 12.02
8/1/2008 39.59 110.25 3 -0.95% % 1.22%
1267.3
7/1/2008 39.97 98.42 8 2.54% 5.75% -0.99%
6/2/2008 38.98 93.07 1280 -0.23% -9.85% -8.60%
1400.3
5/1/2008 39.07 103.24 8 8.71% 3.60% 1.07%
1385.5
4/1/2008 35.94 99.65 9 6.77% 6.79% 4.75%
3/3/2008 33.66 93.31 1322.7 -0.24% -3.78% -0.60%
1330.6
2/1/2008 33.74 96.98 3 1.81% -3.99% -3.48%
1378.5
1/2/2008 33.14 101.01 5 -3.91% 2.53% -6.12%
1468.3
12/3/2007 34.49 98.52 6 4.26% -4.89% -0.86%
1481.1 -
11/1/2007 33.08 103.58 4 11.50% 0.96% -4.40%
1549.3
10/1/2007 37.38 102.6 8 -1.97% 1.42% 1.48%
1526.7
9/4/2007 38.13 101.16 5 -2.33% 9.43% 3.58%
1473.9
8/1/2007 39.04 92.44 9 -2.18% 1.03% 1.29%
1455.2
7/2/2007 39.91 91.5 7 -1.77% 4.62% -3.20%
1503.3
6/1/2007 40.63 87.46 5 4.77% -4.05% -1.78%
1530.6
5/1/2007 38.78 91.15 2 4.70% 2.40% 3.25%
1482.3
4/2/2007 37.04 89.01 7 1.45% -0.90% 4.33%
1420.8
3/1/2007 36.51 89.82 6 7.73% -0.26% 1.00%
1406.8
2/1/2007 33.89 90.05 2 -5.23% 0.42% -2.18%
1438.2
1/3/2007 35.76 89.67 4 2.23% 5.56% 1.41%
12/1/2006 34.98 84.95 1418.3 9.59% 1.80% 1.26%
1400.6
11/1/2006 31.92 83.45 3 2.41% 4.46% 1.65%
1377.9
10/2/2006 31.17 79.89 4 4.91% 1.01% 3.15%
1335.8
9/1/2006 29.71 79.09 5 6.91% 4.19% 2.46%
 1303.8
8/1/2006 27.79 75.91 2 1.39% 4.04% 2.13%
1276.6 11.07
7/3/2006 27.41 72.96 6 3.32% % 0.51%
6/1/2006 26.53 65.69 1270.2 0.61% -1.04% 0.01%
1270.0
5/1/2006 26.37 66.38 9 -3.16% -4.09% -3.09%
1310.6
4/3/2006 27.23 69.21 1 -3.34% 1.02% 1.22%
1294.8
3/1/2006 28.17 68.51 7 -7.94% 3.10% 1.11%
1280.6
2/1/2006 30.6 66.45 6 3.59% 8.15% 0.05%
1280.0
1/3/2006 29.54 61.44 8 9.21% 6.32% 2.55%
1248.2
12/1/2005 27.05 57.79 9 1.54% 5.00% -0.10%
1249.4
11/1/2005 26.64 55.04 8 8.07% 0.57% 3.52%
1207.0
10/3/2005 24.65 54.73 1 4.58% -0.78% -1.77%
1228.8
9/1/2005 23.57 55.16 1 4.34% -1.94% 0.69%
1220.3
8/1/2005 22.59 56.25 3 -2.55% 0.14% -1.12%
1234.1
7/1/2005 23.18 56.17 8 10.49% -3.80% 3.60%
1191.3
6/1/2005 20.98 58.39 3 -2.65% -0.03% -0.01%
5/2/2005 21.55 58.41 1191.5

ACCN LMT S&P

Annual Return 13.67% 7.88% -1.43%
24.45 16.70
Standard Deviation 20.72% % %
Coefficient of Correlation 0.35992

Analysis

The Annual return of Accenture is 13.67% and the annual return of LMT is 7.88% whereas the

S&P has had a negative growth. The Coefficient of Correlation which is 0.35992 has positive

correlation which is about good for the portfolio. A perfect negative correlation would be ideal,

but in practicality it would be impossible to get two companies that are negatively correlated.
Standard Deviation of a Portfolio (enter data only on the blue areas)

WA= 0.5 ρAB= 0.360 ŕA= 0.140 σA= 0.21

WB= 0.5 ŕB= 0.079 σB= 0.24
σA= 0.21 Wa σp= r-bar
σB= 0.24 1.00 21.00% 14.00%
ŕA= 0.14 0.60 18.39% 11.56%
ŕB= 0.079 0.75 18.76% 12.48% 16.00%
ρAB= 0.36 0.50 18.57% 10.95%
C1 0.011025 0.30 19.95% 9.73% 14.00%
C2 0.0144 0.00 24.00% 0.00% 12.00%
C3 0.009072 0.00 24.00% 0.00%
10.00%
Total 0.034497 0.00 24.00% 0.00%

Returns
SD= 0.1857 0.00 24.00% 0.00% 8.00% Series1
0.00 24.00% 0.00%
6.00%
0.00 24.00% 0.00%
Minimun Risk Portfolio 4.00%

2.00%

σA= 0.21 0.00%

σB= 0.24 0.00% 10.00% 20.00% 30.00%
ρAB= 0.36 SDp
Num.= 0.039456
Denom.= 0.065412
WA= 0.603192

 p  W A2 A2  (1  W A ) 2  B2  2W A (1  W A )  AB A B (1)

 B ( B   AB A )
WA  (2)
   B2  2 AB A B
2
A Exp.Retu
Asset rn σ
A 10% 20%
WA= 1.00 0.60 0.75 0.50 0.30 0.00 0.00 0.00 0.00 0.00 0.00 B 16% 40%
WB= 0 0.4 0.25 0.5 0.7 1 1 1 1 1 1 ρAB=0.35
σA= 0.21 0.21 0.21 0.21 0.21 0.21 0.21 0.21 0.21 0.21 0.21
σB= 0.24 0.24 0.24 0.24 0.24 0.24 0.24 0.24 0.24 0.24 0.24
ŕA= 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.14
ŕB= 0.079 0.079 0.079 0.079 0.079 0.079 0.079 0.079 0.079 0.079 0.079
ρAB= 0.36 0.36 0.36 0.36 0.36 0.36 0.36 0.36 0.36 0.36 0.36
C1 0.0441 0.01588 0.02481 0.01103 0.00397 0 0 0 0 0 0
C2 0 0.00922 0.0036 0.0144 0.02822 0.0576 0.0576 0.0576 0.0576 0.0576 0.0576
C3 0 0.00871 0.0068 0.00907 0.00762 0 0 0 0 0 0
Total 0.0441 0.0338 0.03521 0.0345 0.03981 0.0576 0.0576 0.0576 0.0576 0.0576 0.0576
SD= 0.210 0.184 0.188 0.186 0.200 0.240 0.240 0.240 0.240 0.240 0.240

C1=FIRST PART OF (1), C2=SECOND PART OF (1), C3=THIRD PART OF (1)

Efficient frontier of the feasible set

16.00%

14.00%

12.00%

10.00%
Returns

8.00%

6.00%

4.00%
Rf
2.00%

0.00%
18.00% 20.00% 22.00% 24.00% 26.00%

SDp

RF is the risk free rate and it is at 2.5%. The given table shows the efficient frontier of the given
portfolio.