1. Choose a mutual fund that has not been chosen by other students. Discuss and show various expenses of your chosen fund. What is the expense ratio of your fund? What this expense ratio means?
2.Go to its website (Your Mutual fund of Q1) or Morningstar.com and get its annual returns for the past five years. Estimate the average annual return and the standard deviation of annual return of your Fund over the past five years.
3.Go to Yahoo/Finance and download 6 years price of SPY (S&P500). Once you downloaded the price for SPY in your Excel file, estimate annual return of SPY. You can estimate annual return as follow (P14 - P13)/P13. For 2014 return use: (current price - price Dec. 2013)/P of Dec. 2013.
4. Estimate average return of SPY over the past five years and estimate its risk. (Risk is standard deviation of annual returns; in Excel you can easily estimate this standard deviation, once you have estimated annual returns for the past five years).
5.Compare risk and return of your mutual fund with risk and return of S&P500.