MAN00134M: Quantitative Methods for Finance
Module Leader: Lewis Ramsden
Assessment Type: Open
Word Count: 1,500 words (±5%)
Weighting: 50%
Deadline: 11am, Monday 11th August 2025
Key Information
Submission Guidelines
- Formatting:
- Font: Arial, size 12
- Line spacing: Double
- Margins: Minimum 2cm
- Word Count Includes:
- Main text, in-text citations, quotations
- Excluded from Word Count:
- Appendices, title page, tables/figures, reference lists
Late Submission Policy
| Delay Period | Penalty |
|---|---|
| ≤1 hour | -5 marks |
| 1–24 hours | -10 marks |
| Each subsequent 24h | -10 marks (max 5 days) |
| >5 days | Non-submission (0 marks) |
Exceptional Circumstances
- Claims must be submitted before the deadline with evidence.
- Post-submission claims accepted within 7 days of the deadline.
Academic Integrity
- AI use must comply with University guidelines.
- Misconduct will be penalized.
Assessment Structure
Part 1: Analysis of Returns (50 marks)
Task: Analyze daily log-returns for:
- GLOBAL UK
- YORKTECH LTD
- GREENFOODS INC
- Equally Weighted Portfolio
Questions:
- Calculate daily Sharpe ratios (risk-free rate: 4% p.a.). [6 marks]
- Compare assets and recommend the best investment. [8 marks]
- Estimate mean (µ) and variance (σ²) for GLOBAL UK returns. [4 marks]
- Estimate P(0% ≤ return ≤ 0.02%) for GLOBAL UK. [6 marks]
- Assess normality assumption for GLOBAL UK returns. [3 marks]
- Hypothesis test: YORKTECH LTD mean return = 0.00025 (α=5%). [6 marks]
- Calculate test power if true mean = 0.00027. [7 marks]
Part 2: Regression Modelling (50 marks)
Task: Evaluate linear relationship:
- Sales (dependent) vs. Advertising Spend (independent).
Questions:
- Compute correlation coefficient. [5 marks]
- Explain OLS estimation method. [5 marks]
- Interpret β₁ (intercept) and β₂ (slope). [6 marks]
- Assess model fit quality. [5 marks]
- Distinguish between estimator vs. estimate. [4 marks]
- State distribution of OLS estimator for β₂. [4 marks]
- Derive 99% CI for β₂. [6 marks]
- Test significance of advertising spend. [6 marks]
- Explain purpose of error terms (ε). [5 marks]
- Predict sales for £110k advertising spend. [4 marks]
- Propose logarithmic model with “Advertising Type” (Social Media/TV/Radio). [10 marks]
Additional Requirements
- Report Style: Formal, client-facing with clear recommendations.
- Mathematical Content: Formulae excluded from word count.
- Appendices: For supplementary data (not marked beyond word limit).
Total Marks: 100