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Sam is a 25-year-old doctor. She has been able to save $200,000. Based on advice from her parents she wants to invest all the money
Sam is a 25-year-old doctor. She has been able to save $200,000. Based on advice from her parents she wants to invest all the money now. Her hope is to not interfere with the investment until time to purchase her first home which she hopes to do at 35 years old.
Economy | E(Ri) | i | ||||
| Stocks | Bonds | Cash Equivalent | Stocks | Bonds | Cash Equivalent |
China | 25% | 5.5% | 3% | .50 | .10 | .02 |
Germany | 18% | 8% | 5.5% | .20 | .085 | .03 |
Singapore | 28% | 6% | 4% | .40 | .15 | .025 |
Trinidad and Tobago | 32% | 7.5% | 4% | .25 | .05 | .008 |
- Identify at least two investment strategies that may apply to the investor;
- Explain asset allocation to the investor;
- Decide how you would allocate and give reasoning for the decision;
- Calculate the following for the portfolio you have come up with for your investor:
- E(port);
- 2(port); and
- (port);
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