A Report On Portfolio Management

1306 WordsNov 27, 20146 Pages
Portfolio management is making decisions in relation to investment mix and policy, asset allocation for individuals and institutions and balancing risk against performance. This includes the strengths, weaknesses, opportunities and threats in the choice of domestic vs. international, growth vs. safety, and many other trade-offs encountered in the attempt to maximize return given the client’s risk tolerance. (Haughey, 2014) The objective of this report is to prepare a report proposing which portfolio is more suitable for the clients with low risk tolerance and investment horizon of 5-7 years. Sainsbury Despite growth returning to the world economy following the recession of the last three years, one source of risk is economic risk as it remains significant. The recession underlined a structural shift to a low-demand growth environment in the developed world. The main risk is that the business will fail. Despite their name, corporate bonds are not the same as fixed-term savings bonds issued by banks. The key difference is that they are not underwritten by the deposit protection scheme, the Financial Services Compensation Scheme. This means that if the company that issued the bonds goes bust, you are likely to lose some or all of your money. (Caldwell, 2014) On the other hand, there is an upside potential as retailers are showing a growing appetite for international expansion, where economies are strong, consumers are shopping and cultural shifts are paving the way for
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