Robust Analysis: An Investments Class Project on a Shoestring

Authors

Abstract

We propose an investments class project to help students recognize ways to evaluate the robustness of an analytical result and understand the importance of performing such an evaluation. In the first part of the project, students derive basic results for naïve diversification. Then they apply four methods for evaluating the robustness of their initial conclusions: simple replication, an alternative market proxy in the single-index market model, an alternative asset pricing model (the FamaFrench Three-factor Model), and results from another historical period.

Recommended Citation

(2026) "Robust Analysis: An Investments Class Project on a Shoestring," Journal of Economics and Finance Education: Vol. 19: Iss. 1, Article 6.
Available at: https://scholarship.rollins.edu/jefe/vol19/iss1/6