AF4S997 Quantitative Methods for Finance and Risk Management.

AF4S997 Quantitative Methods for Finance and Risk Management - University of South Wales

Part: Marking and Assessment

Assessment Task:

You are required to choose a publicly traded company and estimate the intrinsic value of its ordinary shares using DDM. You should

Provide rationales for your choice of company and your choice of DDM

Brief description of the chosen company`s profile

The suitability of DDM for the chosen company

Justify your decision on the number of stages of dividend growth

Present details of determining dividend growth rate(s)

Method of estimating dividend growth rate(s)

Workings of deriving dividend growth rate(s)

Estimate the required rate of return using CAPM model based on OLS method
Prepare data (minimum requirement: monthly data over last five years)

Specify and estimate the model (i.e., perform the regression estimation)

Discuss the estimation results

Calculate the intrinsic value

Make discussions and conclusion

Summarize estimation results

Critique DDM and CAPM

Carry out data preparation and model estimation in Excel and write up a report in Word

Submit both Word and Exceldocument by 23.59.59 on 5thApril 2020