I am really struggling with getting started, I think a paragraph or two will hel

Question

I am really struggling with getting started, I think a paragraph or two will help me get going. Please provide some meaningful insight into how you would go about this answering the questions below. (you may have to copy and past links in browser)

Portfolio Construction Exercise

Introduction

You have $1,000,000 to invest.

Watch the diversification whiteboard animation:

https://www.youtube.com/watch?v=70IuwU34lv0

Also, please see the diversification slides and explanation video as an additional resource:

https://www.youtube.com/watch?v=9XH4KxFevvE

Video on risk and diversification: https://www.youtube.com/watch?v=4eOxyZ5SV_k&t=9s

What is your investment strategy? Questions to consider:

Which investments did you choose?

Why did you choose these particular investments?

How did you select the number of stocks to put into your portfolio?

Were you selecting growth stocks? Income stocks? A balanced portfolio? A diversified portfolio?

What return could you expect to receive on your portfolio?

Explain why the stocks you chose fit into your personal investment goals.

Note: you may use any investments you want – individual stocks and bonds, mutual funds, ETFs, REITs, commodities – or any other investments.

Deliverable Instructions

Explain why the stocks you choose fit into your personal investment goals. You should base your strategy on what we’ve talked about in class, textbook material, and your research. As usual, document – use quotation marks when it is an exact quote and state the sources. You should write about a page to answer this assignment. One way to start is to take the MAPS questionnaire or the TIAA risk tolerance questionnaire to get a better reading on your personal risk preferences and what investments are appropriate for those preferences. The questionnaire is optional – this is something for you personally; you will not be asked to share your responses (however, you may voluntarily do so).

Explanation / Answer

--

Diversification with stocks and bonds;

And again within stocks, chose multiple industries like telecom, technology, Fast moving Consumer Goods (FMCG), Health care, Transport, Stationary, Bio Medical, pest control, pets care, Dentistry, Educational sector, production, primary industry, manufacturing, service sector, value added services, shipping and logistics, entertainment, and many diversified portfolio.

The simple idea is not to put all your eggs in the same basket

So, you can split your $1 million into 20 chunks of $50,000 each and chose 20 different equally weighted portfolios and invest in them - in this way you spread the risk 20 times apart.

Sources/Citation:

Investors guide from Oxford University Press

Related Questions

Navigate

• Browse (All)
• Browse I
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.