# 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("TGT", "AMZN", "WMT")

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 weigting scheme)

# symbols
symbols <- asset_returns_tbl %>% distinct(asset) %>% pull()
symbols
## [1] "AMZN" "TGT"  "WMT"
# weights
weights <- c(0.25, 0.25, 0.2)
weights
## [1] 0.25 0.25 0.20
w_tbl <- tibble(symbols, weights)
w_tbl
## # A tibble: 3 × 2
##   symbols weights
##   <chr>     <dbl>
## 1 AMZN       0.25
## 2 TGT        0.25
## 3 WMT        0.2

4 Build a portfolio

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

portfolio_returns_tbl
## # A tibble: 20 × 2
##    date       portfolio.returns
##    <date>                 <dbl>
##  1 2013-03-28            0.0727
##  2 2013-06-28            0.0134
##  3 2013-09-30            0.0126
##  4 2013-12-31            0.0732
##  5 2014-03-31           -0.0564
##  6 2014-06-30           -0.0201
##  7 2014-09-30            0.0251
##  8 2014-12-31            0.0646
##  9 2015-03-31            0.0591
## 10 2015-06-30            0.0105
## 11 2015-09-30            0.0171
## 12 2015-12-31            0.0419
## 13 2016-03-31            0.0245
## 14 2016-06-30            0.0218
## 15 2016-09-30            0.0360
## 16 2016-12-30           -0.0199
## 17 2017-03-31           -0.0133
## 18 2017-06-30            0.0223
## 19 2017-09-29            0.0390
## 20 2017-12-29            0.125

5 Plot: Portfolio Histogram and Density

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

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

You should expect a positive return for most quarters ranging between 0.01-0.07 every three months.