Beta Management Company | |
|Investment Management case study |

Table of contents

Backgrounds……………………………………………………….……1
Strategies………………………………………………………………...1
Background of California R.E.I.T and Brown Group Inc……………2
Return and risk…………………………………………………….....…2
Summary………………………………………………………………...4
Appendix………………………………………………………………...5

Background:
Beta Management Company is a small investment management company based in a Boston suburb founded in 1988. As the company developed, they had roughly 25 million dollars in the 1991. The goal of the company is to enhance returns but reduce risks for
Beta Management Company considers that its stock prices are quite variable and somewhat sensitive to movements in the stock market which means a beta that is positive to some significant degree. However, Sarah Wolfe think many brands of the company will wear well during the current recession which means the company’s sales will perform well. It implies, somewhat incongruently, a low beta.

Return and risk
a)
The average returns can be calculated using the Excel’s AVERAGE ( ) function,
|AVERAGE RETURN |SP500 |CalREIT |Brown |
|1989-1990 |2.36% |-2.27% |-0.67% |

2) The standard deviation can be calculated using the STEDV () function:
|Standard Deviation |SP500 |CalREIT |Brown |
|1989-1990 |4.61% |9.23% |8.17% |

From the table, it is easily to see that the variability of both California REIT and Brown Group is double as compare to the Vanguard 500 Index Trust. Also California Reit is more risky than Brown Group because the standard deviation of that group is more than the brown group therefore the Brown Group will be much better for