Econometrics and financial statistics analysis Essay

Essays on Econometrics and financial statistics analysis Essay ASSIGNMENT Testing for the presence of Unit Root: Viewing the trends of the data and the series, it has been established the data presented has been quite helpful in establishing a viable basis for forecasting purpose. The return data of two companies i.e RETEDIN and RETFTSE ALLSHARE help provide us series. Methodology: In order to smooth the data series data and establish a more meaningful series for forecasting purposes, we should first taken quarterly averages of the data series by taking the average of the three months across each quarter. Following that and as per the protocols defined by Koop (2003, p 154-156), we can conduct a unit root test for each of the two variables first to establish whether or not the the series have a unit root. In order to test the series for a unit root, we can use use The Dickey-Fuller unit root test which can be applied. In order to do the Dickey-Fuller test on , we can use the following regression: (theorangedog.net) , and test the hypothesis that . If we can’t reject the null hypothesis, we say that the series has a unit root. In order to do this test in Excel, we computed . Our X variable is ‘’, for t –1 = 1,†¦,65 (or t = 2,†¦, n). In other words, we are regressing on lagged values of . Identify an appropriate univariate model for the estimation of each return series. Comment on the procedure adopted and pay particular attention to the identification, estimation and diagnostic stages of the modelling process. We can establish a univariate regression model for estimating the returns on each series. In developing this model, we can use quarterly average data series as Y or dependent variable, and RETEDIN series as X1 or first independent variable and RETFTSE ALLSHARE series as X2 or second independent variable. We can also calculate the correlation coefficients and coefficients of determination between the Y series with each of the two return series. After reviewing the statistics that validate the model, we can use this model to forecast returns. If these forecast figures show a narrow error margin, it indicates that the model developed is a robust one. Estimate the beta value for your share using a ‘market model’ specification and check the adequacy of the model using appropriate diagnostic tests. The beta value (ÃŽ ²) or the slope of the returns series of the market model can be calculated using the linear regression based on least squares method and the resulting coefficients of the intercepts and slope along with their related t-statistics and p-value will indicate the validity of these estimates. If the p-value of the estimated beta values is less than 0.05, we will conclude that the beta value estimate calculated by our model is valid and adequate for our purpose on hand. Explain what you understand by the term ‘stock market crash’. In September 2001 there was a significant stock market downturn. Using appropriate econometric techniques, test whether this event caused a significant change in the beta value of your share during the sample period. Comment on your results. According to investopedia.com, a stock market crash refers to a significant drop in the total value of a market in a relatively short span of time and be attributable to a bubble, thus leading to a financial situation wherein all the majority of investors are obliged to try to leave the market at the same time with the result that they have to reduce their stock prices. The beta value of our share must be negative in timers of economic downturn or stock market crash of 2001. A negative beta value with a p-value of less than 0.05 would indicate that the probability that the estimated beta value is erroneous is less than 5%. Thus the 95% confidence level can be attached to state that the stock market crash affected a trend in returns on the stocks of the two companies or our data series i.e RETEDIN series and RETFTSE ALLSHARE. References: 1. Koop, Gary. (2003) Analysis of economic data, 2nd edition: John Wiley Sons 2. Hill, Griffiths, Judge Undergraduate Econometrics 3. â€Å"How to do a ‘Regular’ Dickey-Fuller Test Using Excel. Downloaded from: theorangedog.net/wp-content/uploads/.../dickey-fuller-example.doc (accessed: 20.05.2011) 4. onlineregression13:    Multiple linear regression http://onlineregression.sdsu.edu/onlineregression13.php Accessed: (20.05.2011) 5. http://www.investopedia.com/features/crashes/crashes1.asp#axzz1tCUFb2Aj

Roger Federer Free Essays

Roger Federer’s fundamental needs, values, and orientation towards life are symbolized by the four astrological elements. Each person has their own unique balance of these four basic energies: fire (warmth, inspiration, enthusiasm), earth (practicality, realism, material interests), air (social and intellectual qualities), and water (emotional needs and feelings). Federer’s â€Å"elemental make-up† is described below. We will write a custom essay sample on Roger Federer or any similar topic only for you Order Now Remember that most people are â€Å"unbalanced† or lopsided, and if Roger is lacking or deficient in a certain element (or elements), it simply means that he needs to consciously develop that particular aspect in order to appreciate and/or work harder in that dimension of life. Sometimes we overestimate the element that we are least endowed with, sensing it as a lack within ourselves, but more often we neglect or ignore it. The qualities described below will be reiterated and explained in more detail in the following pages.His life is likely to be full of emotional extremes, turbulence, joy and sorrow stemming from his own passionate nature and unpredictability. Roger Federer is impulsive and temperamental. For Roger, everything is intensely personal and colored by emotion. He may have difficulty viewing a situation from a detached, impartial or rational perspective, and he has little inclination to structure and order his life. However, fostering self-discipline, organization and focus is essential.Otherwise Roger Federer will be prone to extreme moodiness, alternating between lofty inspiration and despondency. At times, Roger Federer feels a great deal of internal pressure due to two of his dominant impulses which tend to conflict with one another. The desire for independence and freedom, the need for self-expression and ego recognition, and the urge to leave the past behind in order to propel himself into new experiences may clash with other, equally powerful needs – namely attachments to people and to the familiar, a compelling urge for emotional closeness, and a desire for security.Balancing these two drives is a significant challenge for Federer. Even though his life may be less balanced and perhaps less stable than that of others, it is u nlikely that Roger Federer would change it because he is very vibrant, sensitive and responsive to the ever-changing, dynamic quality of life. However, as you will read in the next chapter, Roger Federer has a sense of practical orientation and a certain down-to-earth approach, which helps to ground him somewhat. How to cite Roger Federer, Papers

Senile Dementia free essay sample

What is senile dementia? Senile dementia is the mental deterioration (loss of intellectual ability) that is associated with old age. Two major types of senile dementia are identified: those due to generalized atrophy (Alzheimer type) and those due to vascular problems (mainly strokes). Senile dementia is often used when referring to Alzheimers disease. Alzheimers disease is most likely to affect older people: of all people over 80, 20% suffers from Alzheimers disease. Senile dementia is actually a group of several different diseases. The common ones are Alzheimers disease, vascular dementia, Parkinsons disease, and Lewy body disease. In Alzheimers disease, the commonest form, the brain atrophies and abnormal proteins, called amyloid, accumlate in the brain substance, in the form of senile plaques. In addition, abnormal filaments appear in the brain cells, the neurons, and they are called neurofibrillary tangles. Alzheimers disease is the most common form of senile dementia. We will write a custom essay sample on Senile Dementia or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page The causes are not yet known, and up to now there is no effective treatment. Patients with Alzheimers isease deteriorate very gradually, so the disease is often not detected in its early stages. Multi-infarct dementia is caused by a series of minor strokes. It usually results from damage to the small blood vessels in the brain causing deprivation of blood supply to the brain cells thus affecting its function. Patients abilities will decline in ladder-like pattern. Other causes of senile dementia include depression, poor nutrition, thyroid dysfunction, drug poisoning, alcoholism, and so on. This kind of dementia can often be corrected by treating the underlying diseases. Senile ementia is a disease caused by degeneration of the brain cells. Its different from normal senility in the elderly. The patients brain function will gradually deteriorate resulting in progressive loss of memory and mental abilities, and noticeable personality changes. Progressive wasting of brain cells or loss of brain function due to hardening of arteries (arteriosclerosis); onset is slow, over years rather than months. Short-term memory is affected first person occasionally forgets what happened hours or minutes ago, and has difficulty following conversations and trains f thought, or making sense of what he or she sees or reads. In early stages, person is well aware of what is happening; even in later stages, confusion may be punctuated by moments of lucidity. With memory and reasoning impaired, person loses interest in activities which were once enjoyable; habitual behaviours which make up personality break down; there is increasing emotional and physical instability, with unpredictable switches between apathy and aggression; social inhibitions, and sometimes sexual inhibitions, also go out of the window. Senile Dementia By Lopaka78