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These clients are both looking to have an active retirement. Client 1 is much closer to retirement and she is looking to utilize the Transition to Retirement program offered by her company. She wants to live a moderate lifestyle and do a bit of traveling. Both her and her partner have very good savings already and continue to add to it until they are both fully retired. With the amount of money already in their savings I think she can be a bit more aggressive to save more before her retirement. She already sees herself, as a moderate to high risk taking and clearly having more money for retirement is a good thing. We also want to make sure she has enough money to spoil her grandchildren as much as possible. I would put her current risk …show more content…

Historical Returns on Three New Investment Vehicles for DW Retirement Plan Large Cap Mid Cap Small Cap Year US Stock US Stock US Stock 5 14.03% 16.99% 16.12% 4 30.11% 35.05% 35.91% 3 10.97% 13.31% 6.10% 2 -1.34% -1.79% -5.16% Last Year 10.21% 12.40% 16.56% AM 12.80% 15.19% 13.91% SD 10.11% 11.81% 13.57% The rate of return was found for these three allocations by finding the arithmetic mean. This is the average of the last 5 years. The standard deviation was then found by using the standard deviation functions in excel. As we can see, these three allocations have the highest rate of returns of all the available allocations. These allocations also have very high standard deviations, which make them more risky than any of the other allocations. These are a good example high risk, high reward. You can from the chart that four years ago these stock options were very good and then 2 years actually had a negative return. These 3 options would be very good for someone with a high-risk tolerance and someone who is looking to make a big return and knows things can go wrong. Both Client 1 and Client 2 will be great candidates for some of these allocations. The rest of the allocations available to these clients are listed below, along with their expected return and standard deviation. Expected Standard Asset Classes Return1 Deviation2 Domestic Equities US Large

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