Asset Allocation (Assignment 1)

Type: Individual 

Instructions: The goal is to attempt to create a diversified equities portfolio in two of the following different constraint conditions. 

1. US portfolio (can only include US stocks):

  • Think of diversification by sector in terms of correlation - i.e. what sectors benefit from oil price decline vs what sectors benefit from a rise in oil prices?

2. Sector your portfolio (pick a sector you are bullish on and only include stocks within that sector):

  • Think of diversification in a more company-specific way - i.e. large cap vs small cap, growth vs value.

Justify your asset allocation: 

  • How are you mitigating risk within each context? 

  • What you are overweight vs underweight in each scenario? 

  • Why?

How did we do?