QUSTION ONE Black Mountain Mining Services (BMMS) is a small scale mining organisation based in the Copperbelt. Its main operations involve the extraction of left-over copper deposits found on various mining dumps found in the major mining towns in the Copperbelt. It also provides short term contractual labour to the more established mining houses. BMMS is mutually owned by its members who are mainly ex-miners or children of ex- miners. The main objective for incorporation was to organize and formalize the informal mining activities in the region. The company has been in operation for about seven years now. Last year, the Management Board approved the long outstanding recommendation to form a private pension for the members of BMMS. It's hoped that the coming of the pension fund will address the general lack of retirement planning that has thus far plagued the members. However, it is already clear that there is a significant lack of appreciation of financial markets in general, and investments in particular even among the Trustees appointed to manage the Fund. As a result, the Management Board has resolved to hire a Consultant to provide Financial Markets and Investments Awareness Training to the Trustees. You have been selected to be the Consultant. Required: A. Explain the main contents and objectives of the procedure that is followed when making an investment. [10 Marks] B. Describe the characteristics of the main players in the investment process and the role of the Fund in such a process. [15 Marks] C. Advice the Trustees on the typical securities to consider on the Zambian financial markets for both short term and long term financial planning. [15 Marks] [TOTAL 40 MARKS] Treasny bills Letterm deposits QUSTION ONE Black Mountain Mining Services (BMMS) is a small scale mining organisation based in the Copperbelt. Its main operations involve the extraction of left-over copper deposits found on various mining dumps found in the major mining towns in the Copperbelt. It also provides short term contractual labour to the more established mining houses. BMMS is mutually owned by its members who are mainly ex-miners or children of ex- miners. The main objective for incorporation was to organize and formalize the informal mining activities in the region. The company has been in operation for about seven years now. Last year, the Management Board approved the long outstanding recommendation to form a private pension for the members of BMMS. It's hoped that the coming of the pension fund will address the general lack of retirement planning that has thus far plagued the members. However, it is already clear that there is a significant lack of appreciation of financial markets in general, and investments in particular even among the Trustees appointed to manage the Fund. As a result, the Management Board has resolved to hire a Consultant to provide Financial Markets and Investments Awareness Training to the Trustees. You have been selected to be the Consultant. Required: A. Explain the main contents and objectives of the procedure that is followed when making an investment. [10 Marks] B. Describe the characteristics of the main players in the investment process and the role of the Fund in such a process. [15 Marks] C. Advice the Trustees on the typical securities to consider on the Zambian financial markets for both short term and long term financial planning. [15 Marks] [TOTAL 40 MARKS] Treasny bills Letterm deposits
