Module 1 – (Almost) Everything You Need To Know About Finance from Robert Shiller’s Data
Inclusive of a free function to download Shiller’s data that contains almost 150 years of data on the price, dividends and earnings for the US S&P 500 along with inflation data and Shiller’s CAPE valuation measure
- Inflation matters
- Share earnings grow 2% faster than inflation
- Share prices track earnings over the long-term
- Dividends matter
- Dividend payout is unfashionable
- Long-term equity returns beat Treasuries (but it’s a rough ride)
- Equity/bond preference depends on your birthday
- Dollar averaging helps
- Valuation Predicts Long-Term Returns
Module 2 – Portfolio Return, Volatility and Correlation
- How to combine portfolio returns using portfolio weights
- How to clean data, deal with missing values and find date ranges for each series
- How to calculate annualised volatility for each series and a portfolio
- How to visualise the return distributions with a multiple return series histogram
- How to calculate correlation and visualise the correlation structure with a multiple scatter plot
- How to visualise and understand asset relationships a large correlation matrix with a tree structure called a dendrogram
- How to visualise the variation of correlation over time with a rolling correlation plot