NEED GUIDANCE on this Case study. PLEASE HELP!
Short-term investment returns: money market instruments. You are an analyst in the insurance industry and are tasked with ensuring that there is a balance of available funds to use to for customer payments in the event of a large disaster like a hurricane during the Atlantic hurricane season of June 1 - November 30. You need to ensure that the funds earn a safe return for the company as they are currently not known to be needed for insurance payouts but they still need to remain liquid. You are tasked with researching and identifying short-term money market investment options for your firm. Assume that the date of this analysis is the current date. The Chief Financial Officer (CFO) has come to you seeking your recommendation on short-term investment options for the upcoming year. You are to provide recommendations and a report illustrating your optimal analysis for investing $3 million of cash in a combination of new T-Bills, CDs and Money Market accounts. See the most recent Federal Reserve FOMC Meeting Minutes for the Dot Plot (See Note 1), "FOMC participants' assessments of appropriate monetary policy: Midpoint of target range or target level for the federal funds rate," (https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm). Net every meeting minutes contains a dot plot so you need to find the most recent one with it. In 2019 they were in March (page 18 of 30), June (page 16 of 29), September (page 19 of 32) and December (page 16 of 28). See if the interest rate environment is one where future rates are expected to increase, decrease or stay the same. Explain why you chose increase/ decrease/stay the same. Due to COVID-19, the Federal Reserve FOMC stated on March 15, The Committee decided to lower the target range for the federal funds rate to 0 to 1/4 percent. The Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals. " https://www.federalreserve.govewsevents/pressreleases/monetary20200315a.htm Explain which lengths of investments are better for that projected direction. Note 1: The Dot Plot is also called "FOMC participants' assessments of appropriate monetary policy: Midpoint of target range or target level for the federal funds rate." See https://www.investopedia.com/dot-plot-4581755 Parameters for the research and analysis report are as follows: 1. Investments selections are short-term money-market (one year or less). 2. A minimum of 3 short-term instruments are to be recommended. a. Only use i Treasury Bills purchased from the U.S. Treasury (https://www.treasurydirect.gov/instit/instit.htm), https://www.treasurydirect.gov/indiv/research/indepth/tbills/res tbill.htm
