ASSIGNMENT-INDIVIDUAL

"DEVELOPING AN INVESTMENT PORTFOLIO"

Your topic is: "Developing a Balanced Investment Portfolio for a Fund Manager"

"You have been appointed to advise one of Australia's leading fund managers, who wishes to establish a fund for investors whose preferences are for a balanced portfolio. These are for investors who are moderately risk averse but who are willing to take a limited amount of risk in the quest for a higher return on their investments and to grow the portfolio over time. The fund currently has $A1 billion dollars available for investment, but the managers expect that, as the fund becomes more widely known, it will grow in the future.

"The fund manager is seeking a well-diversified portfolio with an overall net annual return on assets, after expenses and taxes, of 3% plus inflation (as measured by the CPI), being a mix of income (interest, dividends and rents) and capital growth.

"You are required to analyse the various suitable asset classes available, outlining the nature of each asset class recommended, the historical and expected performances of each asset class identified and the risks of each such asset class. You should prepare a summary of your recommendations for how much of the available funds (in percentage terms, to the nearer whole number) should be invested in each of your selected asset classes [cash, Australian fixed interest, Australian equities, Australian property, overseas fixed interest, shares and / or property and alternative investments (if any - see chapter 18 of the text-book)]. State reasons for your choices and your estimates of the expected annual income and expected annual capital growth likely to be achieved from your recommended portfolio. Summarise the risks of your recommendations.

"Illustrate your analysis, particularly performance history, with appropriate tables, charts and graphs, and where appropriate with illustrative examples."

Other Requirements

Details of the Assignment requirements. suggested points for detailed examination and penalties for late lodgment are in the Subject Outline.

You are required to complete this essay individually (no groups).

Research and Referencing

You should begin by studying various chapters of the text-book (including Chapter 18 on alternative investments) dealing with the above asset classes.

You will need to discover at least 6 references apart from the text-book. This should include at least one other book and one journal article.
Use Harvard referencing!

Marking Guide

The Assignment will be scored out of 100%, in terms of the rubric (see Subject Outline. pages 7 to 9), with the result being converted to a mark out of 30%.

The desired length of your Assignment is 2.500 words + / - 10%.

The purpose of this Assignment is to test your initiative as advanced degree students, along with testing your ability to discover information and apply this to portfolio management.