# Load packages

# Core
library(tidyverse)
library(tidyquant)

Goal

Collect individual returns into a portfolio by assigning a weight to each stock

Choose your stocks.

from 2012-12-31 to 2017-12-31

1 Import stock prices

symbols <- c("TSLA", "NKE")

prices <- tq_get(x = symbols,
                 get = "stock.prices",
                 from = "2012-12-31",
                 to = "2017-12-31")

2 Convert prices to returns (quarterly)

asset_returns_tbl <- prices %>%

    group_by(symbol) %>%
    tq_transmute(select     = adjusted,
                 mutate_fun = periodReturn,
                 period.    = "quarterly",
                 type       = "log") %>%
    slice(-1) %>%
    ungroup() %>%

    set_names(c("asset", "date", "returns"))

3 Assign a weight to each asset (change the weighting scheme)

# symbols
symbols <- asset_returns_tbl %>% distinct(asset) %>% pull()
symbols
## [1] "NKE"  "TSLA"
# weights
weights <- c(0.50,0.50)
weights
## [1] 0.5 0.5
w_tbl <- tibble(symbols, weights)
w_tbl
## # A tibble: 2 × 2
##   symbols weights
##   <chr>     <dbl>
## 1 NKE         0.5
## 2 TSLA        0.5

4 Build a portfolio

#?tq_portfolio

portfolio_returns_tbl <- asset_returns_tbl %>%
    
    tq_portfolio(assets_col   = asset,
                 returns_col  = returns,
                 weights      = w_tbl,
                 col_rename   = "returns",
                 rebalance_on = "quarters")

portfolio_returns_tbl
## # A tibble: 60 × 2
##    date       returns
##    <date>       <dbl>
##  1 2013-01-31  0.0742
##  2 2013-02-28 -0.0325
##  3 2013-03-28  0.0822
##  4 2013-04-30  0.215 
##  5 2013-05-31  0.319 
##  6 2013-06-28  0.0736
##  7 2013-07-31  0.106 
##  8 2013-08-30  0.128 
##  9 2013-09-30  0.139 
## 10 2013-10-31 -0.0739
## # ℹ 50 more rows

5 Plot: Portfolio Histogram and Density

portfolio_returns_tbl %>%
    
    ggplot(mapping = aes(x = returns)) +
    geom_histogram(fill = "cornflower blue", bindwith = 0.01) +
    geom_density() +
    
    # Formatting
    
    scale_x_continuous(labels = scales::percent_format())+
    
    labs(x.    = "returns",
         y     = "distribution",
         title = "Portfolio Histogram & Density")

What return should you expect from the portfolio in a typical quarter?

should expect 5% return from stocks