Abstract
This article is mainly about finding the most efficient portfolio for some chosen stocks in the S&P 500. It is an application of portfolio management. The article introduced data collection and processing for 10 important S&P 500 companies stock data. These companies are chosen as representatives of different industries. The data processing will give sufficient material for the following calculation, such as the covariance matrix for those stocks, average return, monthly return, etc. Markowitzs model is a model for portfolio optimization. Using this model to first minimize the standard deviation, in other words, the risk, and then, the most efficient portfolio weighting for those companies can be chosen. Solver in Excel is also used based on previous data to test the accuracy of the result calculated based on the model. Then, the article introduces possible errors during the calculation and corresponding reflection and improvement.
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