Introduction to Financial Risk Analysis

Risks of a single stock

Setup a spreadsheet to analyze data from Yahoo Finance. There should be tabs for worksheets to:

Spreadsheet setup

Use the historical pricing data from Yahoo Finance.

Historical prices at Yahoo Finance

Select monthly data for a period of 10 years.

Historical prices at Yahoo Finance

Download the raw data:

Historical prices at Yahoo Finance

Import (or copy) into the source worksheet of the spreadsheet:

Historical prices import

The raw pricing data might look similar to this:

Historical prices import

Historical pricing data from Yahoo Finance has already been adjusted for dividend payments and other material changes to the stock.

Historical prices have been adjusted for dividend payments

Calculate the monthly returns and the 5 year periodic returns on a separate worksheet by linking to values in the raw import worksheet.

Calculate monthly returns

( current price – previous month price ) ÷ previous month price = monthly rate of return

Setup and calculate summary analysis of the historical prices for the stock.

Summary analysis of historical stock prices

Use the following formulas for the summary calculations.

Formulas for summary calculations