A portfolio is an individual investors choices of stocks, bonds, mutual funds, and other types of investment.
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Question:
A portfolio is an individual investor’s choices of stocks, bonds, mutual funds, and other types of investment. Pretend that you face these six choices for investments:
- a stock that has appreciated in value by 25% in each of the past 5 years and pays no dividends;
- a stock that has appreciated by 5% in each of the past 5 years and pays an 8% dividend each year;
- a bond that returns 5% each year;
- a mutual fund of international stocks that has appreciated by as much as 45% but depreciated by as much as 30% during the past 10 years;
- a mutual fund of US consumer products company stocks that has consistently appreciated by 12% for the past 5 years;
- a mutual fund of bonds that has consistently appreciated by 7% for the past 10 years.
Choose three of these investments for your portfolio. What are your investment objectives? Why did you choose those three?
Provide rationale and examples to support your thoughts.
Related Book For
Elementary Statistics Picturing the World
ISBN: 978-0321911216
6th edition
Authors: Ron Larson, Betsy Farber
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