You have started work at an investment advisory firm and have met with your first client. Ms. Eunice Albright is currently employed and has received an inheritance of $500,000 and wants you to help her invest it. During your conversation with the client, she spoke of how well certain technology stocks are doing and suggests to you that her friend has told her she should put her entire inheritance into just a few stocks, Facebook, Amazon, Netflix, Tesla, Apple, and Google. Eunice asks for your advice on this strategy. Based on your recent course in Financial Planning and the topics covered in the Investments Section you will write a Business Letter to her detailing your recommendations. Using the Principles involved in Effective Business Communication write a one or at most two-page letter to your client. In the letter outline any problems you have with her friends recommendation for a concentrated portfolio and your overall recommendation for investing her inheritance. In a one-page attachment show details of your recommendation for investing her $500,000.

What would you tell your client about her exposure to unsystematic risk and the advantages of diversification.

What type of performance (based on history) can your client expect from your recommendations?