Creating a Portfolio

About this course: This course integrates all the learning from the first three courses and guides the learner about ways of building a portfolio of strategies and integrating the same into a hedge fund. In the first part of the course, you will be taught ways of measuring the contribution of a strategy to a portfolio in terms of risk and return. You will be able to appreciate the consequences of including a strategy to a new as well an existing portfolio. Next, you are taught various ways of conducting the tilting analysis in order to determine the optimal weight to be placed on each strategy. After this you will learn to develop techniques for minimizing overall portfolio risk. You will also get a basic overview of the regulatory framework that is applicable to hedge funds. You will know about different types of investors and the expectations of each type of investors.

Who is this class for: This course is primarily aimed at individual investors and money managers who want to gain the skills required to develop their own trading strategies and make money using them

Created by:  Indian School of Business

• Taught by:  Ramabhadran Thirumalai, Assistant Professor

  Indian School of Business

• Taught by:  Prasanna Tantri, Senior Associate Director

  Center for Analytical Finance

Basic Info Course 4 of 5 in the Trading Strategies in Emerging Markets Specialization Level Beginner Commitment The estimated workload for this course is 4 to 5 hours per week Language English How To Pass Pass all graded assignments to complete the course. User Ratings 4.6 stars Average User Rating 4.6See what learners said Coursework

Each course is like an interactive textbook, featuring pre-recorded videos, quizzes and projects.

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Indian School of Business The Indian School of Business has successfully put India on the global map of management education by nurturing young leaders with an understanding of developing economies and the society at large. Through innovations in curricula and pedagogy to reflect the shifting business landscape, the ISB is committed to providing the best venue for management education to meet the growing need to develop young leaders who can manage global challenges.

Syllabus


WEEK 1


Module 1
In this module you will learn about the efficient market hypothesis and various market anomalies. In the second half, you will learn how to evaluate the performance of investments.


7 videos, 3 readings, 2 practice quizzes expand

1. Video: Market Efficiency
2. Video: Types of Market Efficiency
3. Video: Anomalies
4. Practice Quiz: Practice Quiz 1
5. Video: Performance measurement 1
6. Video: Performance measurement 2
7. Video: Market timing
8. Video: Performance measurement 3
9. Practice Quiz: Practice Quiz 2
10. Reading: The Challenge: How To Benchmark Your Investment Portfolio
11. Reading: Performance Measurement: The What, Why, and How of the Investment Management Process
12. Reading: The 101 ways to measure portfolio performance

Graded: Quiz 1

WEEK 2


Module 2



In this module you will lean how to perform style analysis and performance attribution. You will also learn some facts about the mutual fund performance and timing measurement. In the second half of the module you will learn how to calculate the expected returns and risk. The module ends with an understanding of the utility theory.


9 videos, 1 reading, 2 practice quizzes expand

1. Video: Timing measurement
2. Video: Style Analysis
3. Video: Performance attribution
4. Video: Mutual fund performance
5. Practice Quiz: Practice Quiz -
6. Video: Expected returns and risk
7. Video: Utility theory
8. Video: Investment Choices and Portfolios
9. Video: Capital Allocation
10. Video: Risky portfolios
11. Practice Quiz: Practice Quiz
12. Reading: Utility theory and Attitude toward Risk

Graded: Quiz 2

WEEK 3


Module 3



In this module you will learn the importance of diversification in your portfolio. You will learn about the efficient frontier and how to draw it. Also, you will study the investment opportunity set with more than one risky asset and a risk free asset. Finally, you will see how to optimally allocate between a risky and a risk free asset. You will also get a brief idea about the market portfolio and capital market line.


7 videos, 4 readings, 1 practice quiz expand

1. Video: Diversification and efficient frontier
2. Video: Two fund separation
3. Video: Diversification revisited
4. Video: Investment opportunity set with two risky assets and a risk-free asset
5. Video: Investment opportunity set with three risky assets and a risk-free asset
6. Video: The optimal allocation between risky and risk-free assets
7. Video: The market portfolio and the capital market line
8. Practice Quiz: Practice Quiz
9. Reading: The pros' guide to diversification
10. Reading: Diversification: How much is too much?
11. Reading: The 15-Stock Diversification Myth
12. Reading: Does the composition of the market portfolio really matter?

Graded: Weekly assessment 3

WEEK 4


Module 4



In this module you will learn the basics of trading strategies based on text mining and the importance of a benchmark to evaluate the performance of your portfolio. You will also see how to backtest your trading strategy. Finally, you will learn the importance of reporting and compliance in trading.


7 videos, 1 reading, 1 practice quiz expand

1. Video: Strategies based on Text Mining
2. Video: Benchmarking
3. Video: Reporting
4. Video: Financial Instruments
5. Video: Backtesting
6. Video: How to backtest?
7. Video: Conclusion
8. Practice Quiz: Practice Quiz
9. Reading: Successful Backtesting of Algorithmic Trading Strategies

Graded: Weekly assessment 4