You are given the CASE FACTS of Andy Murry a leading Architect Investment profile to answer questions.
Question:
You are given the CASE FACTS of Andy Murry a leading Architect Investment profile to answer questions.
CASE FACTS
Type of Investor Individual; Architect, 50 years of age, in good health
Asset base $3,000,000
Started return desire or investment goal 12% points above the average annual return on U.S.
Annual income from nonportfolio sources (before tax $400,000 from his professional practice
Annual spending needs $200,000
Other return factors 4% inflation rate
Risk considerations Owns large concentration in U.S. small-capitalization stocks
Specify liquidity requirements $80,000 charitable donation in 10 months
Time specifications Retirement at age 80
Tax Concerns Income and capital gains taxed at 30 percent.
Underline the word art right that best describes the client's
A Willingness to accept risk Below average Above average
B Ability to accept risk Below average Above average
C Risk tolerance Below average Above average
D Liquidity requirement Significant Not significant
E Time Horizon Single stage Multistage
F Overall time horizon Short to intermediate term Long term
G Tax concerns Significant Not significant
Discuss appropriate client objectives: (10 marks)
(a) Risk
(b) Return
Expert Answer:
Based on the given case facts of Andy Murry lets analyze his investor profile and discuss appropriate client objectives in terms of risk and return Cl... View the full answer
