This file calculates optimum weights for components of a stock portfolio. The weights are calculated accoring to Markowitz theory for minimizing risk for a given target portfolio return

Markowitz model provides a way to define a portfolio which is efficient - one which has highest reward for a given risk, or lowest risk for a given reward

To use this spreadsheet, just press calculate button.
Following are tasks performed by this workbook:
1.It reads the stock symbols entered in input section and loads the historical stock prices from yahoo finance using internet connection. Time range being considered is the start and end dates specified in the input section
2.Creates a matrix of stock prices for all the symbols entered. It then creates a matrix of stock returns.
3.Creates a covariance matrix of stock returns
4.It is assumed that expected returns for each stock is equal to historical returns. (This might not be necessarily true!)
5.Create an objective function which takes guess values of portfolio weights and returns portfolio variance. Input weights vector has length NoOfStocks-2. This is becuase the other 2 weights are solved by using theses constraints:
-Weight of all members in portfolio should be 1
-Expected return of portfolio should match target portfolio return
6.Use simplex method to find set of weights which minimize portfolio variance.