FIN3IPM Portfolio Management
FIN3IPM Portfolio Management
ASSIGNMENT PART 1 PORTFOLIO PROPOSAL CASE STUDY
You currently work for an individual client adviser for Bell Potter Securities, a leading Australian stockbroking and investment advisory firm, which provides investment advice, share trading and wealth management services. These clients pay full-service advisory and commission fees to your firm in return for the provision of initial investment planning and evaluation services, ongoing investment and related advice and the development and management of investment strategies and portfolios on their behalf.
You have just been assigned a new client to represent. The clients details are as follows.
Name of client: David Lister
Dave is in his late 20s.
He has just inherited $500,000 from his great aunt and would like to use this money to start saving for his retirement.
He works as an actor, which means that sometimes he earns a good income but at other times goes through periods with little or no income. He wants to set up a plan whereby he can invest money for retirement during those times he is on a good income, but possibly rely on his investments for income when he is out of work.
He describes himself as a conservative investor, preferring to avoid undue risk.
He is a Vegan (i.e. avoids all food made from animals) and would like his investments, at least to some extent, to be consistent with his chosen lifestyle.
The client doesnt wish to be exposed to the risks and transaction costs involved in investing directly in stocks listed on foreign stock exchanges, or in any assets other than stocks and exchange-traded funds (ETFs) listed on the ASX. However, there are a large number of ETFs which provide exposure to foreign stocks, domestic stocks, bonds, commodities, currencies and many other assets, and the client is willing to consider investing in any ETFs you would like to put forward.
There is an Assignment Data File on the LMS which provides information about:
A selection of 75 large Australian listed stocks.
A selection of 120 ASX-listed ETFs.
When making the asset allocation decision for your portfolio proposal, the portfolio can only include:
Australian listed stocks as shown in the Assignment Data File.
ETFs listed in the Assignment Data File.
Note that you must purchase a whole number of shares or ETF units.
Cash we will assume an interest rate equal to the daily 1-month Bank Bill Swap Rate. This was 4.3% on 19 April. This is the interest rate that will be used in calculating the return on your portfolio in Part 2 of the assignment.
Bitcoin the price of ONE Bitcoin on 19 April was A$99,491.30. If you wish to speculate by purchasing Bitcoin you dont need to purchase a whole number of Bitcoins. Simply allocate a certain dollar amount and assume you can buy in fractional amounts.
