Question
Use this information to answer #14, #15 and #16. Exactly fifteen years ago, Marco's parents invested $90,000 into two mutual funds: the ABC Canadian
Use this information to answer #14, #15 and #16. Exactly fifteen years ago, Marco's parents invested $90,000 into two mutual funds: the ABC Canadian Bond Fund ($27,000) and XYZ Canadian Equity Fund ($63,000) - they have not made any additional purchases and neither of the funds have paid any distributions. At the time of their original investment, their stated risk tolerance indicated that a Balanced Growth (70% Equity / 30% Fixed Income) asset allocation was appropriate for them. However, a newly completed KYC indicated that they should have a Conservative (30% Equity / 70% Fixed Income) asset allocation. Both of the funds have performed very well as can be seen from the following chart Fund ABC Canadian Bond Fund XYZ Canadian Equity Fund Original Investment $27,000 $63,000 Current Market Value $43,231 $141.449 Marco's parents have booked an appointment with you to withdraw $32,000 from the account for completing basement renovations. Based on the above information, which specific buy and sell trades would you recommend? SELL: $95,645 of the CANADIAN EQUITY FUND BUY: $63,645 of the CANADIAN BOND FUND SELL: $62,850 of the CANADIAN EQUITY FUND BUY: $92,400 of the CANADIAN BOND FUND
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