Diversification in The Management of Their Clients’ Portfolios
Order ID 53563633773 Type Essay Writer Level Masters Style APA Sources/References 4 Perfect Number of Pages to Order 5-10 Pages Description/Paper Instructions
Diversification in The Management of Their Clients’ Portfolios
INSTRUCTIONS:
Your company TCI Investments Inc. was approached by three different potential investors. As Junior Analysts at the company you have been assigned one of potential investors and is being asked to construct an Investment Portfolio for the client.
The following gives an overview of the potential investors.
Mr. Lyons He is a 45-year-old farmer who is looking to invest in order to ensure that he can retire comfortably. He wants to invest $100,000 of his savings and be able to reap benefits in the next 15-20 years. Mrs. Dixon She is a 60-year-old retired judge who is looking to buffer her retirement pension plan. She wants to invest $500,000 from which she would like to get back returns immediately. Ms. Andrews She is a 25-year-old who recently landed her first job after college. She wants to begin saving towards her retirement at age 60. She has only $1,000 to invest but plans to put $500 per month to that amount along the way. The company has always maintained diversification in the management of their clients’ portfolios and has identified the following markets as prime investment opportunities.
Fundamental analysis of the countries’ probable economic conditions reveals the following:
Possible Economic
Condition
China (Steel) Germany (Automobile)
Singapore (Financial) Trinidad Tobago (Oil)
and Probability ROI Probability ROI Probability ROI Probability ROI Boom .70 12% .35 15% .45 14% .50 16% Recession .10 8% .05 7.5% .25 7% .15 6% Normal .20 10% .60 10.5% .30 12.5% .35 13% TCI Investments Inc have decided that they would use a combination of the following assets classes in any one of their portfolios:
- Stocks (Listed on any Stock Exchange); · Bonds (Companies or Government); and · Cash Equivalents.
The following information was retrieved from the four economies about the financial assets:
Economy Expected (Ri) Standard Deviation (σi) Stocks Bonds Cash Equivalent Stocks Bonds Cash Equivalent
China 19% 9% 3% .36 .15 .02 Germany 16% 8.5% 5% .25 .08 .01 Singapore 23% 8% 5.5% .50 .20 .04 Trinidad and Tobago 10% 7.5% 4% .15 .07 .005 Required:
- Identify the company’s role as the investor’s portfolio management team;
- Provide an overview of an Investor Lifecycle; clearly highlighting the phase to which your client belongs.
- Construct a Policy Statement for the assigned client to include:
- Investor Goals;
- Investor Objectives;
- Investor Constraints.
- State the importance of globally investing and why diversification is important to a portfolio.
- Correlation; and
- Risk-Free Assets.
- Identify and explain the possible risks the investor’s investment may be exposed (must discuss a minimum of four).
- Identify at least two investment strategies that may apply to the investor.
- Explain the importance of asset allocation to the investor.
- Decide how you would allocate the investor’s available funds and give reasoning for the allocation decision.
- Calculate the E(Ri) for each economy and discuss the results;
- Calculate the following for the portfolio you have come up with for your investor: a. E(port);
- σ2(port); and
- σ(port);
- Conclude with discussing how your company plans to execute the final stage of constructing a portfolio.
Students are required to use the following rubric as a guide to completing this assignment.
CRITERIA ALLOTTED ATTAINED COMMENTS Content (50 Marks) A. Company’s Role 5 B. Investor Lifecycle 5 C. Policy Statement 10 D. Global Investing 5 E. Potential Risks 10 F. Investment Strategies 5 G. Asset Allocation Decision 10 Calculations: (40 Marks) A. Expected Returns and Discussion per Country 20 B. Portfolio Returns and Standard Deviation 20 Conclusion 5 APA references and intext citations 3 Use of subject language 2 TOTAL MARKS 100 This assessment is worth 20% of your total marks and must be done within the deadline specified. Failure to do so will result in an automatic grade of zero. Plagiarism, improper documentation and blatant careless incorrect grammar and spelling will be penalized by the loss of 2.5 marks of your grade in each case.
RUBRIC
QUALITY OF RESPONSE NO RESPONSE POOR / UNSATISFACTORY SATISFACTORY GOOD EXCELLENT Content (worth a maximum of 50% of the total points) Zero points: Student failed to submit the final paper. 20 points out of 50: The essay illustrates poor understanding of the relevant material by failing to address or incorrectly addressing the relevant content; failing to identify or inaccurately explaining/defining key concepts/ideas; ignoring or incorrectly explaining key points/claims and the reasoning behind them; and/or incorrectly or inappropriately using terminology; and elements of the response are lacking. 30 points out of 50: The essay illustrates a rudimentary understanding of the relevant material by mentioning but not full explaining the relevant content; identifying some of the key concepts/ideas though failing to fully or accurately explain many of them; using terminology, though sometimes inaccurately or inappropriately; and/or incorporating some key claims/points but failing to explain the reasoning behind them or doing so inaccurately. Elements of the required response may also be lacking. 40 points out of 50: The essay illustrates solid understanding of the relevant material by correctly addressing most of the relevant content; identifying and explaining most of the key concepts/ideas; using correct terminology; explaining the reasoning behind most of the key points/claims; and/or where necessary or useful, substantiating some points with accurate examples. The answer is complete. 50 points: The essay illustrates exemplary understanding of the relevant material by thoroughly and correctly addressing the relevant content; identifying and explaining all of the key concepts/ideas; using correct terminology explaining the reasoning behind key points/claims and substantiating, as necessary/useful, points with several accurate and illuminating examples. No aspects of the required answer are missing. Use of Sources (worth a maximum of 20% of the total points). Zero points: Student failed to include citations and/or references. Or the student failed to submit a final paper. 5 out 20 points: Sources are seldom cited to support statements and/or format of citations are not recognizable as APA 6th Edition format. There are major errors in the formation of the references and citations. And/or there is a major reliance on highly questionable. The Student fails to provide an adequate synthesis of research collected for the paper. 10 out 20 points: References to scholarly sources are occasionally given; many statements seem unsubstantiated. Frequent errors in APA 6th Edition format, leaving the reader confused about the source of the information. There are significant errors of the formation in the references and citations. And/or there is a significant use of highly questionable sources. 15 out 20 points: Credible Scholarly sources are used effectively support claims and are, for the most part, clear and fairly represented. APA 6th Edition is used with only a few minor errors. There are minor errors in reference and/or citations. And/or there is some use of questionable sources. 20 points: Credible scholarly sources are used to give compelling evidence to support claims and are clearly and fairly represented. APA 6th Edition format is used accurately and consistently. The student uses above the maximum required references in the development of the assignment. Grammar (worth maximum of 20% of total points) Zero points: Student failed to submit the final paper. 5 points out of 20: The paper does not communicate ideas/points clearly due to inappropriate use of terminology and vague language; thoughts and sentences are disjointed or incomprehensible; organization lacking; and/or numerous grammatical, spelling/punctuation errors 10 points out 20: The paper is often unclear and difficult to follow due to some inappropriate terminology and/or vague language; ideas may be fragmented, wandering and/or repetitive; poor organization; and/or some grammatical, spelling, punctuation errors 15 points out of 20: The paper is mostly clear as a result of appropriate use of terminology and minimal vagueness; no tangents and no repetition; fairly good organization; almost perfect grammar, spelling, punctuation, and word usage. 20 points: The paper is clear, concise, and a pleasure to read as a result of appropriate and precise use of terminology; total coherence of thoughts and presentation and logical organization; and the essay is error free. Structure of the Paper (worth 10% of total points) Zero points: Student failed to submit the final paper. 3 points out of 10: Student needs to develop better formatting skills. The paper omits significant structural elements required for and APA 6th edition paper. Formatting of the paper has major flaws. The paper does not conform to APA 6th edition requirements whatsoever. 5 points out of 10: Appearance of final paper demonstrates the student’s limited ability to format the paper. There are significant errors in formatting and/or the total omission of major components of an APA 6th edition paper. They can include the omission of the cover page, abstract, and page numbers. Additionally the page has major formatting issues with spacing or paragraph formation. Font size might not conform to size requirements. The student also significantly writes too large or too short of and paper 7 points out of 10: Research paper presents an above-average use of formatting skills. The paper has slight errors within the paper. This can include small errors or omissions with the cover page, abstract, page number, and headers. There could be also slight formatting issues with the document spacing or the font Additionally the paper might slightly exceed or undershoot the specific number of required written pages for the assignment. 10 points: Student provides a high-caliber, formatted paper. This includes an APA 6th edition cover page, abstract, page number, headers and is double spaced in 12’ Times Roman Font. Additionally, the paper conforms to the specific number of required written pages and neither goes over or under the specified length of the paper. GET THIS PROJECT NOW BY CLICKING ON THIS LINK TO PLACE THE ORDER
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