T a Comment & Markup Annotation Editor PORTFOLIO RISK AND RETURN On a weekend in late October 2015, Albert sat over his breakfast, and imitated of his personal investment portfolio over the past seven years. He remembered that, after the financial crisis in 2007-08, he had been advised to avoid U.S. stocks and to put his savings in the emerging economies of Malaysia and Singapore. Therefore, he decided to distribute his funds to two exchange traded funds (ETF) invested in the equity markets of Malaysia and Singapore, namely Lya Malaysia and Lyx Singapore, in the ratio of 60 per cent and 40 per cent respectively. Although Albert had been satisfied with his portfolio performance over the past seven years. The high growth in these two emerging markets had failed out lately. However the advice he had pathered from analysts reports implied that he should stay invested in these marketi, notwithstanding with more attention to the volatile strikes PORTFOLIO DIVERSIFICATION Albert had enrolled in a corporate finance class on risk and return to improve his investment knowledge. During the classes, he learned that the risk of portfolio was not simply a weighted average of the individual variances of the component assets. Rather, it was determined to a large extent by the co-movement between the returns of the component assets. Accordingly, Albert reasoned that diversification to include an asset that was imperfectly correlated with the existing components of his portfolio should decrease his risk without sacrificing retums, if he had understood correctly With this understanding. Albert tried to search for an asset that was not correlated with Lyx Malaysia or Lyx Singapore THE RECOVERING U.S. EQUITY MARKET Albert wondered whether he should move some of her funds to US. equity. The US. economy appeared to have beefined from the rounds of quantitative casing and was finally recovering from the doldrums. The U.S. unemployment data had improved and there was speculation that the Federal Reserve might raise interest. Surely, the fact that the United Stated was picking up at a time when Malaysia and Singapore were slowing down was indicative of low correlation among the three economies. FINANCILA ANALYSIS To confirm his idea, Albert decided to pick an ETF that tracked the US. equity market. He observed that Lyx United States Dow Jones Industrial Average (USDIA) was invented in the public equity markets of the United States, in the stocks of companies operating across diversified ctors, excluding transportation and utilities secas Animation Desk Get Animation Desk for Mac, a simple and beautiful tool to create traditional hand drawn animations on your Mac MacBook Air T a Comment & Markup Annotation Editor PORTFOLIO RISK AND RETURN On a weekend in late October 2015, Albert sat over his breakfast, and imitated of his personal investment portfolio over the past seven years. He remembered that, after the financial crisis in 2007-08, he had been advised to avoid U.S. stocks and to put his savings in the emerging economies of Malaysia and Singapore. Therefore, he decided to distribute his funds to two exchange traded funds (ETF) invested in the equity markets of Malaysia and Singapore, namely Lya Malaysia and Lyx Singapore, in the ratio of 60 per cent and 40 per cent respectively. Although Albert had been satisfied with his portfolio performance over the past seven years. The high growth in these two emerging markets had failed out lately. However the advice he had pathered from analysts reports implied that he should stay invested in these marketi, notwithstanding with more attention to the volatile strikes PORTFOLIO DIVERSIFICATION Albert had enrolled in a corporate finance class on risk and return to improve his investment knowledge. During the classes, he learned that the risk of portfolio was not simply a weighted average of the individual variances of the component assets. Rather, it was determined to a large extent by the co-movement between the returns of the component assets. Accordingly, Albert reasoned that diversification to include an asset that was imperfectly correlated with the existing components of his portfolio should decrease his risk without sacrificing retums, if he had understood correctly With this understanding. Albert tried to search for an asset that was not correlated with Lyx Malaysia or Lyx Singapore THE RECOVERING U.S. EQUITY MARKET Albert wondered whether he should move some of her funds to US. equity. The US. economy appeared to have beefined from the rounds of quantitative casing and was finally recovering from the doldrums. The U.S. unemployment data had improved and there was speculation that the Federal Reserve might raise interest. Surely, the fact that the United Stated was picking up at a time when Malaysia and Singapore were slowing down was indicative of low correlation among the three economies. FINANCILA ANALYSIS To confirm his idea, Albert decided to pick an ETF that tracked the US. equity market. He observed that Lyx United States Dow Jones Industrial Average (USDIA) was invented in the public equity markets of the United States, in the stocks of companies operating across diversified ctors, excluding transportation and utilities secas Animation Desk Get Animation Desk for Mac, a simple and beautiful tool to create traditional hand drawn animations on your Mac MacBook Air