Customized Investment Plans Using CAPM and HRP

Abstract

During the past few months, a lot of people, mostly millennials,  have begun to invest money as they have realized its importance  and power. An investment in the right combination of stock can  go a long way. In the current scenario, the new investors are  playing it smart by choosing safe options like mutual funds. But in  reality, a diversified portfolio, though a little riskier than the  former, guarantees better returns. Our project is based on helping  these investors make wise decisions as per their requirements and  make sure they receive the maximum returns given their preferred  level of risk. We plan on making this process of making a  portfolio easy for these investors. The market that is being  considered is National Stock Exchange (NSE). The stocks that  will be examined will be those enlisted in the NSE. We will be  predicting the stock growth using appropriate methods and using  this data for further steps. The stock growth prediction has been done using multiple approaches. Seeking the user’s point of view  is extremely important if we want to build a customized portfolio,  hence he/she will have to take a small quiz to throw some light on his/her expectations from the portfolio. The portfolio will be built  based on the user preferences. Following this, risk minimization  will be done using various methods. The agenda is to produce a  portfolio that gives maximum returns for the specified risk level. The project has been programmed in Python using a number of  libraries and extensions. This project is still in the research and  testing stages. It is highly recommended not to take the following  findings as investment advice.