1. You win $300 in an office football pool. You: (a) spend it on groceries, (b) purchase lottery tickets, (c) put it in a money market account, (d) buy some stock. 2. Two weeks after buying 100 shares of a $20 stock, the price jumps to over $30. You decide to: (a) buy more stock; it's obviously a winner, (b) sell it and take your profits, (c) sell half to recoup some costs and hold the rest, (d) sit tight and wait for it to advance even more. 3. On days when the stock market jumps way up, you: (a) wish you had invested more, (b) call your financial advisor and ask for recommendations, (c) feel glad you're not in the market because it fluctuates too much, (d) pay little attention. 4. You're planning a vacation trip and can either lock in a fixed room-and-meals rate of $150 per day or book standby and pay anywhere from $100 to $300 per day. You: (a) take the fixed-rate deal, (b) talk to people who have been there about the availability of last-minute accommodations, (c) book standby and also arrange vacation insurance because you're leery of the tour operator, (d) take your chances with standby. 5. The owner of your apartment building is converting the units to condominiums. You can buy your unit for $75,000 or an option on a unit for $15,000. (Units have recently sold for close to $100,000, and prices seem to be going up.) For financing, you'll have to borrow the down payment and pay mortgage and condo fees higher than your present rent. You: (a) buy your unit, (b) buy your unit and look for another to buy, (c) sell the option and arrange to rent the unit yourself, (d) sell the option and move out because you think the conversion will attract couples with small children. 6. You have been working three years for a rapidly growing company. As an executive, you are offered the option of buying up to 2% of company stock: 2,000 shares at $10 a share. Although the company is privately owned (its stock does not trade on the open market), its majority owner has made handsome profits selling three other businesses and intends to sell this one eventually. You: (a) purchase all the shares you can and tell the owner you would invest more if allowed, (b) purchase all the shares, (c) purchase half the shares, (d) purchase a small amount of shares. .7. You want to take someone out for a special dinner in a city that's new to you. How do you pick a place? (a) read restaurant reviews in the local newspaper, (b) ask coworkers if they know of a suitable place, (c) call the only other person you know in this city, who eats out a lot but only recently moved there, (d) visit the city sometime before your dinner to check out the restaurants yourself. 8. The expression that best describes your lifestyle is: (a) no guts, no glory, (b) just do it!, (c) look before you leap, (d) all good things come to those who wait. 9. Your attitude toward money is best described as: (a) a dollar saved is a dollar earned, (b) you've got to spend money to make money, (c) cash and carry only, (d) whenever possible, use other people's money. SCORING SYSTEM: 24-32: You're semi-aggressive, willing to take chances if you think the odds of earning more are in your favor Score your answers this way: (1, 0-3 (2)C-3 (3) b-4 (4) a-2 (5) b-4 (6) a-4 (7) C-4 (8), a-4 (9) b-3 31 My score is 31 and semi-aggressive, willing to take chances if you think the odds of earning more are in your favor Question Your assignment is to Draft an investment policy statement for your self, use above data with the questionnaire to help you, the score you get will help you draft your Investment policy statement. Your IPS should include your Risk and Return objective - recall goals should be stated as one of the four goals; Capital preservation or Capital Appreciation, or current income, or Total Return. You should also include current context, and your long term and short term goals, adding the type of asset classes you can invest in is a plus ? 1. You win $300 in an office football pool. You: (a) spend it on groceries, (b) purchase lottery tickets, (c) put it in a money market account, (d) buy some stock. 2. Two weeks after buying 100 shares of a $20 stock, the price jumps to over $30. You decide to: (a) buy more stock; it's obviously a winner, (b) sell it and take your profits, (c) sell half to recoup some costs and hold the rest, (d) sit tight and wait for it to advance even more. 3. On days when the stock market jumps way up, you: (a) wish you had invested more, (b) call your financial advisor and ask for recommendations, (c) feel glad you're not in the market because it fluctuates too much, (d) pay little attention. 4. You're planning a vacation trip and can either lock in a fixed room-and-meals rate of $150 per day or book standby and pay anywhere from $100 to $300 per day. You: (a) take the fixed-rate deal, (b) talk to people who have been there about the availability of last-minute accommodations, (c) book standby and also arrange vacation insurance because you're leery of the tour operator, (d) take your chances with standby. 5. The owner of your apartment building is converting the units to condominiums. You can buy your unit for $75,000 or an option on a unit for $15,000. (Units have recently sold for close to $100,000, and prices seem to be going up.) For financing, you'll have to borrow the down payment and pay mortgage and condo fees higher than your present rent. You: (a) buy your unit, (b) buy your unit and look for another to buy, (c) sell the option and arrange to rent the unit yourself, (d) sell the option and move out because you think the conversion will attract couples with small children. 6. You have been working three years for a rapidly growing company. As an executive, you are offered the option of buying up to 2% of company stock: 2,000 shares at $10 a share. Although the company is privately owned (its stock does not trade on the open market), its majority owner has made handsome profits selling three other businesses and intends to sell this one eventually. You: (a) purchase all the shares you can and tell the owner you would invest more if allowed, (b) purchase all the shares, (c) purchase half the shares, (d) purchase a small amount of shares. .7. You want to take someone out for a special dinner in a city that's new to you. How do you pick a place? (a) read restaurant reviews in the local newspaper, (b) ask coworkers if they know of a suitable place, (c) call the only other person you know in this city, who eats out a lot but only recently moved there, (d) visit the city sometime before your dinner to check out the restaurants yourself. 8. The expression that best describes your lifestyle is: (a) no guts, no glory, (b) just do it!, (c) look before you leap, (d) all good things come to those who wait. 9. Your attitude toward money is best described as: (a) a dollar saved is a dollar earned, (b) you've got to spend money to make money, (c) cash and carry only, (d) whenever possible, use other people's money. SCORING SYSTEM: 24-32: You're semi-aggressive, willing to take chances if you think the odds of earning more are in your favor Score your answers this way: (1, 0-3 (2)C-3 (3) b-4 (4) a-2 (5) b-4 (6) a-4 (7) C-4 (8), a-4 (9) b-3 31 My score is 31 and semi-aggressive, willing to take chances if you think the odds of earning more are in your favor Question Your assignment is to Draft an investment policy statement for your self, use above data with the questionnaire to help you, the score you get will help you draft your Investment policy statement. Your IPS should include your Risk and Return objective - recall goals should be stated as one of the four goals; Capital preservation or Capital Appreciation, or current income, or Total Return. You should also include current context, and your long term and short term goals, adding the type of asset classes you can invest in is a plus