To illustrate the development of a portfolio, construct a portfolio of investment securities by selecting these 5 Fortune 500 stocks and these 3 AAA rated corporate bonds bellow. The goal is to diversify the portfolio as much as possible given the constraints on the number of securities used in this example. The criteria to be used include the investor demographics, asset allocation strategy and risk tolerance provided to each student individually by the instructor in the first week. Please list the characteristics provided along with your answer to the following:
1. Calculate the weighted average beta of the stocks within the portfolio.
2. Determine if and how the portfolio construction would change by using an alternative asset allocation strategy. PS: please used word instead of excel A. Fortune 500 Companies (Company Overview and beta Calculation)
1. Bank of America
2. Exxon Mobil
3. Chevron
4. General Electric
5. ConocoPhillips
B. AAA Rated Corporate Bonds (Company overview and beta Calculation)
1. Johnson & Johnson
2. KFW International
3. International BK for Recon & Dev
2. Determine proper portfolio construction
A. Asset allocation strategy #1,2,3
1. 2012 Recovery and normal inflation.
2. 2012 Double dip lengthy recession
3. 2012 Bull market continues
3. Its impact in a change of marital status
B. Tax implications 1. Married with children 2. Single with children 4. Conclusion