Essays on Investment Portfolio

Traidos Bank and Roche’s Drug Trial in China

Introduction An organisation or a firm can set standards that may determine what is good or bad while making decisions. These are the ethics of an organisation, knowing what is right and wrong and deliberately choosing to do the right thing. Traidos bank prides itself on being ethical. It is guided by having six principles. The principles are, promoting sustainable development in everything that they do, respecting and obeying the laws of any country that they work in, respecting human right regardless of race and culture, respecting the environment by discouraging negative influence, being accountable for anything that they ...

International Investments Diversification

International Investments Diversification The term global portfolio refers to a group of investments, assets and securities held in foreign markets rather that the domestic market. Traditionally, investors have preferred to focus on international portfolio investment when it comes to the investment in marketable securities. As opposed to the only domestic portfolios, the international portfolio yields more value for the same level of risk. Ideally, an investor should analyze the global stock market to identify the markets that are related to their domestic stock/ securities market in terms of risks and rewards (Agati, 2007). This helps investors reduce their anxiety ...

Investment Portfolio Project

For my personal portfolio, the following values shall be taken into consideration.

Ri for every portfolio is calculated as follows Disney= 2%(19.3)=0.386

Therefore, Treynor’s indices are calculated as follows:

(Ri-Rf)/beta For Disney; (0.386-1)/1=-0.614 Citigroup= (1.12-1)/1= 0.12 General electric= (0-1)/1=-1 Morgan Stanley= (0.252-1)/1=0.748 Home depot= (0.5208-1)/1=-0.4792 Treynor’s indices are critical in determining the viability of an investment portfolio. Considering this investment platform, and the associated Treynor’s indices, a viable economic decision can be made out of it. The two modern portfolio theories, the Sharpe’s and Harry Markowitz’s Modern stipulate that an investment must consider both ...

Introduction

The capital market is a wider portfolio market that deals with securities. The investment banking process provides a platform for the securities trading. The investors are provided with an opportunity to choose the appropriate financial instrument to choose. The portfolio management provides key elements that are applied by the investors in understanding the capital investment market. Therefore, the study seeks to explore on capital market investment and investment banking.

Portfolio and investment banking process

Investment banking process involves financial institutions that provide assistance to individuals, corporations, and governments in achieving and raising financial capital. This is through underwriting or taking part as the agent ...

Investment Portfolio Project Final Paper and Presentation

Investment Portfolio Project Final Paper and Presentation In an ideal situation, an investor would like to investment in an asset or portfolio of asset characterized by high returns and low risk. However, the ideal world does not exist and so is the ideal portfolio as opined in the sentence above. This understanding gave birth to several portfolio theories and among these theories is the modern portfolio theory whose key contributors included Harry Markowitz and William Sharpe. In the modern portfolio theory of MPT as it is famously referred to, the theorists emphasize the importance of diversification in the portfolio. ...

Introduction

The purpose of business is to obtain the maximum revenue at the lowest cost of capital in a competitive environment. The realization of this goal requires of comparing the size of the capital invested in the production and trading activities with the financial results of this activity. However, in the implementation of any kind of economic activity there is objectively a risk of loss, the volume of which is due to the specifics of a particular business. Risk is the probability of losses, damages, shortfalls of projected revenues, profits. Losses that occur in business activities can be divided into ...

Article Reviews

The newly developed SASB allowed companies to take into consideration external events (Eccles, 2016) that cannot be controlled such as the effects of climate change. The reason for the accounting standard addition is that governments cannot ignore the effects on industrial markets and their investors (Eccles, 2016). The value of accounting standards is that it allows individuals, companies, and governments to generate wealth since it allows financial performance comparisons (Eccles, 2016). The problem is that there was no previous standard developed for nonfinancial performances (Eccles, 2016) especially on environmental and social activities.

Areas of Agreement

The advantage of the article is that ...

Investment Portfolio Statement

Investment Policy Statement: Executive Summary:

Tax ID: A1258122 Current assets: $10,000,000 Return: 7 % 1-yr Loss Limit: (Worst case scenario): - 10 % Purpose of investment policy statement: The main purpose of this investment policy statement is to provide the client with a clear investment plan that ensures maximum returns. It therefore:

Provides an excellent overview of all investment options available to the client

Ensures that all investment options are in line with the client’s needs, wants, and objectives It provides the required means of communication between the client and all other parties involved in the investment plan It meets all the laid out international, state, and federal laws ...

INVESTMENT PORTFOLIO STATEMENT

Investment Policy Statement: Executive Summary: Type of policy: Individual Retirement Investment Policy Tax ID: A1258122 Current assets: $10,000,000 Return: 7 % 1-yr Loss Limit: (Worst case scenario): - 10 % Purpose of investment policy statement: The main purpose of this Investment Policy Statement (IPS) is to provide the client with a clear investment plan that ensures maximum returns. The IPS plays the role of assisting the client in monitoring, evaluating and supervising his or her investment portfolio. The IPS therefore:

Provides an excellent overview of all investment options available to the client.

Ensures that all investment options are in line with the client’s needs, wants, and objectives. It provides ...

PERSONAL FINANCE INVESTMENT IN QATAR: INVESTING QR 1000000

Abstract This article describes a personal finance project which entails the investment of QR 1000000 in a short time frame, from 1 March to 27 May 2016. We first define personal finance and establish the five steps of a personal financial planning process, which entails: (1) assessment of the individual’s financial situation; (2) determination of the individual’s financial goals; (3) creation and details of the financial plan, based upon the determined goals; (4) execution of the aforementioned plan; (5) monitoring and reassessment of the plan. For each one of the five stages, we carry out the required ...

Risk, Return, and Portfolio Allocation: Why Stocks Are Less Risky Than Bonds in the Long Run

Risk, Return, and Portfolio Allocation: Why Stocks Are Less Risky Than Bonds in the Long Run

Summary of Chapter 2:

In the current article by Siegel J. J, the main idea explained is that the risk associated with the corporate bonds and the stocks is based on the market value in the future. The main focus of the article is on the lower risk levels long term investments in stocks as compared to the investments in the bonds. The techniques used in the article are analyzing the historical data and few statistical formulas such as correlation and the standard deviation. At the same ...

Vanguard Actively Managed Common Stock Fund

As actively managed stock funds can either outperform or underperform an index, fund or portfolio managers use a strategy to combine extensive market research with their experience and forecasting activities. One of the actively managed stock funds Vanguard has in its mutual fund family is known as “Vanguard Dividend Growth Fund”. This fund tends to invest in all those high-quality companies that pay growing dividend payments while this fund attempts to outperform the stock market index. From 2007 to 2009, this fund lost only forty two percent while the overall stock market lost fifty five percent due to plunge ...

ABSTRACT

The aim of this dissertation is mainly to analyzethe risk in the New York Stock Exchange using Statistical aspects and the computation of Value at Risk. The technique of Value at Risk or Value at Risk (VaR) is a methodology to standardize the calculation of the various risks that occur in a business e.g. banks, stock exchanges and corporations. The risk is defined as the probability of obtaining a result different than expected, the factors that will depend on the position of the entity, the risk factor under consideration and the time of calculation. Thus, the VaR seeks to establish quantitatively the ...

Financial risk of an enterprise can be defined as the probability of adverse financial consequences in the form of loss of income and capital under uncertainty conditions for its financial activity. Financial risks have a great variety and for the implementation of effective management are classified by several main features that will be considered below. Financial risks arises in the process of enterprise relationships with financial institutions (banks, financial, investment, insurance companies, stock exchanges and others). Causes of the financial risk are inflation factors, the growth of bank interest rates, reduction of the value of securities and others.

Financial risks are roughly divided into two types:

1) ...

Differences in the Risk of a Clothing Company and a Utility Company

A clothing company has high exposure to both diversifiable and non-diversifiable. Diversifiable risk exists within the company because of internal activities of the entity (Hopkin, 2013, p. 2). The company can avoid this type of risk by diversifying its investment portfolio. The clothing company has much exposure to this risk because they concentrate on one investment, clothing. On the other hand, the clothing company cannot avoid non-diversifiable risk because non-diversifiable risk affects the whole market (Jordao & Sousa, 2010, p. 2).

On the other hand, a utility company has limited exposure to diversifiable risk. The company has an investment in ...

Introduction

In an investment, it is critical to make appropriate decisions that are relevant to the business. The essence of this is to minimize the risks and ensure that the business is on a steady path. The investor has, therefore, to consider following some guidelines that ensure that a proper forecast of the investment is done to ensure that there are no such issues, poor returns on investments (Matthäus-Maier, et al, 2007). The guidelines that are relevant for aggressive equity investors and conservative equity investors for investment decision forms the basis of evaluation in this paper.

The guidelines for conservative equity ...

Introduction

An investment portfolio can be defined simply as where one keeps one’s money. If one chooses to keep all one’s money as cash in one’s bank account, then that becomes one’s portfolio. Definitely, it is not a smart investment portfolio. The interest one will be earning from the bank will probably be less than the inflation rate. Therefore, the value of money over time will decrease. Because of this reason, it is advised that one should spread one’s money around a few different investment instruments. Investment can be of different types based on the requirement of ...

Abstract

The Nelson – Siegel – Svensson model is one of the preferred methods by which investors determine the value of bonds in the long run and thus make informed guesses as to the viability of each investment option. It is an accurate method of prediction when an investment portfolio needs to be set up. In this paper, by using the Nelson – Siegel – Svensson process, an attempt will be made to inform investors like to the best option for a fixed income portfolio. The paper would demonstrate how the process is to be used and applied to the data related to treasury bonds ...

Executive Summary

The beginning investment portfolio was composed of ten Dow Jones Industrial 30 stocks that totaled an investment of $498,598. A hedging tactic was applied in order to have the capacity of liquidating the put options at prices that are close or in the money on the present Dow 30 portfolio. This tactic is applied in order to reduce the potential of risk in the event that the market goes flat or in the declining direction during the next year and a half. The selling of the put requests against the value of the beginning investment at strike values that ...

Executive Summary

With the objective of evaluating an investment bank, which we are keen to add to our investment portfolio, we carried out an in-depth analysis of Goldman Sachs using three sections, namely, Business Environment Section, Operations Section and Financial Performance. While the company is operating under diversified investment industry, the financial performance of the company was highly optimistic and the major reason that we are recommending that the stock of this financial institution of this company should be included in our portfolio.

Introduction

The objective of this report is to provide a comprehensive overview of leading investment bank, Goldman Sachs Inc. which ...

Introduction

A sovereign wealth fund (SWF) is a government-owned investment fund that is done when there is a surplus in the balance of payment. The investment portfolio comprises of investment in financial assets such as equity or hedge funds, precious metals, stock and bonds. These funds are able to invest globally as well (Roubini, 2008). The SWF are funded by the profits that are received from foreign exchange reserves that are held by the State Bank of the country or the commodity exports. Total Assets under Management by the SWF has been increasing drastically over the last several years. The maximum estimate ...

Introduction

Management of portfolio always gives a good reasoning to the investor to park their money in their stocks accordingly, and with a flare of earnings. There are hundreds of thousands of investors who get benefited from the management of portfolio (Swensen, p.45). Managing portfolio with optimization of the best available options to invest is a great thing on which the entire productivity of an investor would depend heavily. All the investors in the world are trying to mitigating their direct cost and risk in a perfect manner, because they have the idea in their mind that managing of risk will increases the investment ...

Introduction

Investments have two aspects; returns and risks that determine their desirability to an investor. In that respect, analyzing the two is crucial, and several models have been advanced for the purpose of identifying most suitable portfolios. In addition, investor's preferences and risk profile determine their investments choices. Thus, a portfolio construction is based on the involved assets return and risk as well as the client’s risk profile. To demonstrate the process of portfolio construction in view of the clients’ profile, this report uses a case of a client with identified investments goals. The report uses a questionnaire to evaluate the clients risk ...

Project Overview

As it was presented and further approved by the Board of Directors, this document aims to enact a detailed implantation plan of the Online Loyalty Program for the clients of an Eagle´s Next Hotel Chain. Current loyalty solution applying physical cards proves to be ineffective and market competition drives innovation in this sector. Given the IT capabilities and existing market technology it was suggested that the company develops personalized mobile application that will serve as a loyalty cards upon validation of the hotel stay.

The arguments behind the recommendation for the investment portfolio were summarized as follows:

- Financial benefits from the project account s for USD$ 20 million in profit over the ...

Rules to secure financial future

Introduction In the times of prolonged worldwide financial crisis a lot of people strive for financial stability and independence, as it can grant you a pretty much easy life even during harsh times. And regardless of money a person makes, most experts believe that with smart management every single person is capable of keeping more of what they make, than simply spending it, and they will still be able to make ends meet in their financial obligations. 3 rules to secure financial future Do not overspend on buying stuff that you do not need, or can live without (spend ...

While working with this essay, I will touch on the major themes of the social security and insurance programs that Czech Republic has developed over the past. This will include areas of Social Security and Expenditures giving the historical perspectives in addition to the social security payments system that in Chile’s cases was originally pay as you go. The paper will also direct its spotlight on the distribution of income among the paper of varying ages especially the elderly and how the Social Security Taxes are structured to reflect this distribution of the age groups. The social security ...

Question one

The major type of risk that Pasiminco faces are: - Interest rate risk- this risk is due to financial market conditions. Pasminco borrowings may be based on a fixed on floating rate of interest. It is obvious Pasminco has debt financing in its portfolio and if they are charged variable interest rates on their loans then there is a risk that the level of interest charged may be unfavorable if market interest rates are high. Pasiminco most probably failed to raise intermediate financing because their credit rating had fallen to warrant the difficulty in raising additional capital from lenders. In ...

Executive Summary 3

Overview of Current Situation 3 Summary of Needs and Objectives 4 Summary of Recommendations 4 Summary of Expected Outcomes 4 Important Information 5 1.0 Objective 6 2.0 Current Situation 6 2.1 How to get there 7 3.0 Recommendation 1 9 3.1 What is Salary Sacrifice? 9 3.2 Steps 9 3.3 Benefits of the Recommendation 11 3.4 Risk Associated with the Recommendation 13 4.0 Recommendation 2 14 4.1 Steps 15 4.2 Benefits of the Recommendation 15 4.3 Risk Associated with the Recommendation 15 ...

When investing one's money, several factors should be considered starting with evaluating what a portfolio should comprise of. This report will analyze three different items. First of all, it will address the effects of international diversification on the investment portfolio. It will then address alternative investment vehicles and finally it will look at how the derivative securities can also enhance a portfolio performance. An international portfolio involves people looking at investment choices outside the United States since they create high diversification for customers. International portfolio has provided security of assets. In the event that the United States stock market crashes, ...

Houston Insurance Holdings is a leading specialty insurer based in Texas, USA. However, its scope of operation extends beyond the United States of America and has offices in the United Kingdom, Spain and Ireland. The insurance company underwrites 100 classes of specialty insurance products in 180 countries around the world. The company has five underwriting segments namely: Professional liability, U.S Property Casualty, Accident and Health and U.S Surety and Credit International. The firm engages in the diverse business portfolio in order to ensure consistent underwriting results irrespective of the market cycles. This has contributed to an impressive performance of ...

Part I: a) Based on the above information, please calculate bond's price today.Bond Face value calculation formula

F=face value C=Coupon Payment = F *contractual interest rate N=number of payments i= market interest rate M= Value at maturity P=Market price of the bond also known as the fair market value F=200000 (face Value) ; C= 200,000*5%=50 ; N= 5; i= 4% ; M=200,000 So Bond’s Price today is = 10000((1-1.04^(-5))/ 0.04) + 200,000(1.04)^(-5) = $208,903 so the bond is undervalued. This makes it a great bond to but for any investor at face value.

Part I: b) What is the bond's price today if market rate is 6%?

F=200000 (face Value) ; C= 200,000*5%=50 ; N= 5; i= 6% ; ...

While there are many different types of organizations, there are certain characteristics which permeate all organizations. Such characteristics cut across the various sectors in which organizations belong. The primary characteristic that is common to all organizations is that they all have goals which they seek to achieve. Indeed, all the activities of an organization usually revolve around these goals. This is similarly the case when it comes to organizations that are involved in business activities. While they may have many other goals, the principal goal of any business organization is to increase its profitability while at the same time ...

Quantitative Methods

Holding period return Holding period return is the total returns received from holding a particular investment portfolio of assets. The holding period return rate usually calculated as the total sum of all income and capital gains of the investments divided by the investment value at the beginning of the trading period being measured (Hallerbach, 2003). It is a very basic way used to measure the rate of return obtained from a particular investment. Therefore, its calculation is based on a unit-value-invested rather than on a time basis. This, however, makes it difficult to provide a comparison of returns on different investments with also different ...

1. Background to the Acquisition This proposed acquisition is between two firms, Congoleum Corporation (Abridged) and Prudential Insurance Company of America where by Congoleum is the targeted company and Prudential the acquiring one. The negotiations of the acquisition shall be handled by First Boston and Century Capital Corporation whereby the former is the lead negotiator while the latter shall one of the prospective equity participants. Congoleum is a highly diversified company with three products market segment; home furnishings, ship building and automotive and industrial distribution. The firm has an asset and revenue base of $323million and $576million respectively. In ...

News Report 1: Pressure Builds On Merkel As Spain Calls For Bank Aid

(Donahue, 2012)

The article throws light on the existing debt crisis in Europe and efforts made by its member countries to sail through this difficult situation. The financial condition of Spain is the prime focus of this article. The unemployment and industrial outputs have been declining in Europe for the past two years. According to the United States President Barack Obama, the leaders of Europe have not made sufficient efforts to control the crisis situation. With deteriorating financial condition of Spain, its Prime Minister has resorted to calling for a ‘banking union’ to fight the worsening problem. A banking union ...

Executive Summary

Fundamental analyses of company shares involve the review of the financial aspects of a company and generate metrics, such as the price and book value of a security or the enterprise value and the EBITDA to value of a stock. Conversely, the technical analysis of a company shares involves the valuing of company shares on the historical information about pricing and volume. In this analysis several assumptions are used: the market value is taken to reflect the demand and supply of the security, the demand and supply are driven by factors such as economic and information analysis which are rational and speculations which ...

A good investment portfolio requires proper investment decision based on the past, present and future market trends. This calls for thorough analysis of both the industry and the individual investment in order to ascertain the portfolio’s viability and profitability. This paper therefore highlights the investors’ profiles in the USA’s capital market and considers the current capital market information of the USA to help in building an investment portfolio.

The United States Capital Market is the world’s largest capital market with seven sectors and six categories of instruments.

The main sectors or the players are: Households, fund managers, corporate managers, bankers and brokers, foreign investors, insurance executives, and government officials. The securities (securitized instruments) include corporate equities, ...

Supervisor:

Abstract In modern business world characterized with competition, acquisition and mergers are dominating main company’s games. In fact, major companies in such as food sectors and banks are acquiring smaller firms in order to ensure that control competition and assets are strengthened. Just like numerous other decisions, there is need for careful prognosis and study before taking this important step in analysis of assets in a company, business performance, and acquisition overall viability. Embry Investment Group is a company that is exploring for a company to qualify for acquisition. This report is aimed at gaining a deeper comprehension on the viability ...

Question 1: What are the advantages of leads and lags over direct loans?

Leads refers to acceleration of the time of making foreign currency payments while lags on the other hand refer to delaying the time of making foreign currency payment. It is aimed at increasing the working capital or reducing foreign-exchange exposure. Lags and leads are achieved by modification of credit terms extended in one currency to another. Most multi-national companies use leads and lags to reduce the exchange risk and to transfer the financing burden from one unit to another. There are several advantages of leads and lags when compared to direct loans. An official note as a recognition of a ...

Abstract

Before making any decision on the choice of an investment plan, it is very important that the individual carries out an intensive evaluation on the available investment options. Real estate is a very significant part of investment portfolio due to its numerous advantages and the les associated risks as compared to other forms of investments. As a Personal Retirement Plan, I opt for real estate. In this work, I have thoroughly investigated the theories and literature on real estate as an investment plan, and examined the both the benefits and the risks associated with such kind of an investment. There are ...