Portsmouth Business School BA Accounting
BA Accounting with Finance
BA Accountancy & Financial Management
BA European Business Administration (Germany to UK)
Share Trading Assignment
The assignment is due in on Friday 3rd February 2017
Assignment Objectives
You are given a notional £100,000 to invest in the UK stock market in shares listed on the FTSE ALL
Share index. You need to split your investment 50:50 between two portfolios of shares, one where you
selected the shares by technical analysis and the other by fundamental analysis. Your aim is to beat the
market with both portfolios. It is important you can demonstrate that you know the difference between
these methods. You need to compare and contrast the two portfolios and you need to make explicit
reference to EMH in your analysis.
Submission Requirements
• You need to submit a 2000 word report on your trades, including full referencing according to
Harvard APA.
• Your report needs to be submitted to Turnitin, in addition a hard copy submission to the
Undergraduate centre is required.
• An appendix with a spreadsheets of your trades (these should not be submitted to turnitin)
Assignment Requirements
• You are given a notional £100,000 to invest in the UK stock market.
• You have four months to trade. This means that you are going to have to use short-term
investment strategies.
• The aim is for you to try to beat the market. The market is represented by the FTSE ALL Share
Index – if you do not ‘beat the market you will not lose marks, most people will find it
impossible to do better than experienced investors. You must calculate the return on the
market from your first trade to your last trade in order to determine whether you have beaten the
market or not.
• The shares MUST be listed on the FTSE ALL Share.
• You are not allowed to use derivatives, such as options or any short selling.
• 50% of your investment must be based upon fundamental analysis and the other 50% on technical
analysis (Based on two theories – no more or less, just TWO).
• Each of your portfolios must contain at least 10 shares.
• You are allowed to trade as many times as you like.
Portsmouth Business School BA Accounting
BA Accounting with Finance
BA Accountancy & Financial Management
BA European Business Administration (Germany to UK)
Recommended Format
Introduction – You need to explain the rational for the assessment, ‘are you able to outperform the
market?’ This means a challenge to the EMH. What strategies you used and which if any of your
portfolios beat the market.
Method – A discussion of the strategies you used and justification of approach would be useful, making
reference to the journal articles that you review. How did you select the companies for your portfolios?
You don’t have to give a list of every company and why, it should be in general. The detail should be in
the appendix.
Results & Analysis – How did the portfolios perform? Did they beat the market, which was best? Any
analysis of your results based on literature reviewed.
Conclusion –
Appendix – Spreadsheet of all of your trades, with notes on why you chose your companies. The
spreadsheet needs to have profit and loss for each of your shares and should say your final profit. The
spreadsheet needs to take account for trading costs, see below for details.
Sources of Data
Share prices, News & Events
Yahoo Finance http://uk.finance.yahoo.com/
Morning Star http://companyintelligence.morningstar.com/client/portsmouth you need to access this from
the university
The short view is excellent for videos http://www.ft.com/markets/the-short-view, we will discuss some in
lectures.
Google Finance https://www.google.co.uk/finance
Bloomberg Financial Database – RB1.08 and Capital IQ Database – RB 2.08 & 2.09 We will be
having classes on this in week 5. This will show you how you can select your companies for the both
technical and fundamental analysis.
Portsmouth Business School BA Accounting
BA Accounting with Finance
BA Accountancy & Financial Management
BA European Business Administration (Germany to UK)
Calculating the trading costs
The above information is taken from Yahoo Finance 30th August 2016. So if I were to buy Tesco shares
on that day I would have paid 164.15p (ask price) and 164.10p (bid price) if I were selling on the day.
When you purchase shares you must also pay Stamp Duty of 0.5% of the purchase price. There is no Stamp
Duty payable when you sell your shares.
You should also assume that you buy your shares online through an Internet broker. Assume that the broker
charges you a flat fee of £7.50 per trade, i.e. £7.50 when you buy and £7.50 when you sell.
Example: If I were to buy 1000 shares Tesco shares on 30th September 2016, then
Purchase Cost £1,641.50 1000 x £1.6415(ask price)
Stamp Duty £8.21 £1,641.50 x 0.005
Brokers
commission
£7.50 It is always £7.50 regardless of the size
Total costs £1,657.21
Note: You can buy and sell in any amount you like. In our example we bought 1000 shares, but you do not
have to buy in round amounts. For example, you could buy 723 shares or any other number you like.
Portsmouth Business School BA Accounting
BA Accounting with Finance
BA Accountancy & Financial Management
BA European Business Administration (Germany to UK)
References
Dimson, E., & Marsh, P. (1998). Murphy’s Law and Market Anomalies. Social Science Research
Network (SSRN) .
De Bondt, F. M., & Thaler, R. (1985). Does the Stock Market Overreact? The Journal of
Finance , 40 (3), 793-805.
Fama, E. (1991). Efficient Capital Markets II. The Journal of Finance , 46 (5).
Lakonishok, J., Shleifer, A., & Vishny, R. W. (1994). Contrarian Investment, Extrapolation, and
Risk. The Journal of Finance , 49 (5), 1541-1578.
Malkiel, B. G. (2003). The Efficient Market Hypothesis and its Critics. The Journal of Economic
Perspectives , 17 (1), 59-82.
Jegadeesh, N., & Titman, S. (1993, March). Returns to buying winners and selling losers:
Implications for stock market efficiency. Journal of Finance 48, 65-91., 48(1), 65-91.
Portsmouth Business School BA Accounting
BA Accounting with Finance
BA Accountancy & Financial Management
BA European Business Administration (Germany to UK)
Students are reminded that the definition of plagiarism includes claiming another person’s work as your
own; for example through inadequate references of sources of material used (including internet sources).
Direct quotations must be enclosed in quotation marks and referenced. Using other people’s ideas
requires a reference even if a direct quote is not included.
Marking
Criteria –
Failure < 40% 40 – 59% 60– 69% First >70%
Introduction and
background to
topic
Limited introduction
not focused on aims
of assignment
Topic well focused
but introduction and
context incomplete
Introduction clearly
expressed; context
well defined
As for good pass
Understanding
of key issues
Minimal
understanding of key
issues
Main issues largely
identified, but some
lack of focus
All issues clearly
understood, with
some
differentiation in
terms of importance
Issues clearly
understood and
differentiated in
terms of importance
Evidence of
reading and/or
choice of
appropriate
concepts
Little evidence of
reading or limited
/inappropriate use of
module material;
unclear theoretical
framework;
important work
uncited or key
concepts ignored
Evidence of reading
or appropriate use of
module material but
with some gaps.
Literature /concepts
adequately but not
critically reviewed.
Good critical
literature review or
well-justified
choice of module
material.
Theoretical
framework supports
study.
Demonstrates high
level of scholarship.
Analysis Largely descriptive;
practically no
analysis of central
issues. Qualitative
or quantitative data
analysis inaccurate.
Some critical analysis
of central issues, but
with some
inaccuracies.
Relevant and full
analysis
Comprehensive and
critical analysis of
central issues.
Presentation and
evaluation of
evidence
Some evidence to
support arguments
but uncritical
acceptance of
material; poor or
incomplete citation;
unjustified
conclusions.
Appropriate
evidence, generally
assessed critically;
weak interpretation of
qualitative aspects;
some gaps in linkages
between evidence and
conclusions.
Full, critical
assessment of
discriminatingly
selected material;
some evidence of
independent
thought
Full, critical
assessment of
discriminatingly
selected material;
evidence of
independent
thought; substantial
individual insights
evident
Presentation:
Structure,
clarity, use of
grammar,
correct spelling
Poor: lack of
structure and clarity;
grammatical
mistakes; inadequate
referencing
Reasonably clear
presentation;
reasonable
referencing; few
grammatical or
spelling mistakes
Demonstrates very
good
communication
skills; accurate
referencing; very
few/no grammatical
or spelling errors
Excellent
communication
skills; accurate
referencing;
virtually no errors;
scholarly, wellorganised
treatment
of material
Attainment of
learning
objectives
Attainment of
few/none of the
relevant learning
objectives
Attainment of a good
majority of the
relevant learning
objectives
Attainment of
substantial majority
of the relevant
learning objectives
Attainment of
nearly all of the
relevant learning
objectives
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