Background Information James has no investment policy or guidelines for investing. James, 34, works as a real estate developer. Jamess company is responsible for building many of the luxury residential buildings in Honolulu. He has no family or girlfriend and has been working 1418-hour days for the last 6 years. He has accumulated 1.5 million dollars over his career but hasnt had time to invest the money. He was recently promoted and will not need to work as many hours as he has in the past. He plans to start dating, marry, and start a family in the next 5 years. He currently owns an apartment valued at $800,000. He plans to keep or sell the apartment in five years to buy a $1 million dollar home. If he keeps the apartment, he can lease the unit for $4,500 and the monthly maintenance fee is $2,100.

James doesnt expect his future spouse to provide any income when he marries. His recent promotion came with a salary of $250,000 per year and he was given an apartment from the most recent building constructed. The expected value for the unit is expected to be $750,000 upon completion in a week. He doesnt know if he should sell the unit or lease the unit for $4,000. The maintenance fee for the building will be $1,500 a month.

Personality James is risk averse but knows risk is necessary for opportunities. He is comfortable taking a chance as long as the possible benefit outweighs the risk. He understands his investing strategy must include some risk to provide the necessary growth and returns. He expects to work as a real estate developer for the next 20 years. He wants to retire early and live on the money generated from his portfolio. He expects to have one child and pay for undergraduate school in twenty-four years.

Profile

Objectives

Return Requirement

State the desired investment outcome. Include when funds will need to be withdrawn or accumulated.

Risk Tolerance

What level of risk tolerance is your client willing to accept? What level of risk can he or she afford to take?

Constraints

What limitations do you have on investing? You must consider the internal constraints such as liquidity needs, time horizon, or other unique circumstances. What external constraints such as tax or regulatory requirements will limit your investment opportunities?

Liquidity

Time Horizon

Taxes

Laws and Regulatory Environment

Unique Circumstances and/or preferences.

Investment Strategy

Include a brief description of each investment approach. Choose which investment approach you prefer.

Passive Investment Approach

Active Investment Approach