R for Investors

Do you want to be able to ensure your portfolio is truly diversified? Do you want to quantify exactly how much risk you are taking with your portfolio? What long-term returns should you expect with your portfolio? This course helps you answer these questions for yourself and learn to do this yourself using the powerful statistical language R that is used by many investment professionals.

This course is intended for people who already have a basic knowledge of R and finance. If you have some familiarity with both R and finance this will help you deepen your knowledge.

including tax

What you'll Learn

As you go through the lessons you will learn how to calculate the key measures for any investor including return and risk. This will enable you to better understand your investments so you can make truly informed decisions.

Visualisation is an important aspect of understanding data, so in this course, you will also learn how to do this using the powerful and elegant ggplot2 library.

Ramin is often asked how he produces his graphs for PensionCraft’s YouTube videos and after completing this course you will understand how he does this and be able to replicate some of them and extend them to include analysis based on your own portfolio.

As you go through the lessons in you will learn to calculate key measures for any investor including return and risk. One focus of the approach is that it relies on visualising data to better understand it so it makes extensive use of the ggplot2 library to do this. If you have watched PensionCraft videos on YouTube you will be able to reproduce some of the graphs used in the videos so that you can replicate and extend these analyses based on your own portfolio.

Key Focus Areas

These will include:
  • How to use the ggplot2 library to plot a time series
  • How to calculate annualised returns
  • How to construct an approximate total return series from a yield series
  • How to convert a price and dividend series to a total return series
  • How to easily combine investment returns into a portfolio return
  • How to calculate and visualise daily return distributions and calculate their annualised volatility
  • How to calculate and visualise correlations 
  • How to build a correlation tree

Course Breakdown

Through a mixture of videos and text Ramin will take you through the following content:
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