An Evaluation Of An Investment Management Process

1104 Words Apr 13th, 2016 5 Pages
The Weebly website defines investment as a commitment of funds made in the expectations of some positive rate of return otherwise emphasizing that expectation of returns in an essential element of an investment (imsmo.weebly.com). Basically, any business investment strategy comprises of a number of facets with some additional assistance from professional fund managers, settlement, dealing and the preparation of reports for clients (imsmo.weebly.com).
Investment strategies are broadly divided into two main categories: real investments and financial investments. Levisaukaite (2010) categorizes real investments as investments that generally involve some kind of tangible assets such as machinery or land. On the other hand, financial investments often involve contracts stipulated in paper or presented in some electronic form such as stocks or bonds.
Any investment strategy demands the formulation of an investment management process. An investment management process stipulates how an investor should go about in making his/her decisions. The process involves a five-step procedure in which the stages include:
• Setting an investment policy
• An analysis and evaluation of investment vehicles
• The formation of a diversified investment portfolio
• Portfolio revision
• The measurement and evaluation of portfolio performance.
Herein, the paper offers a practical example of an investment process or activity. Using the above investment procedures, the paper rigorously shows how investors…
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