Topic: You are responsible for managing a $500,000 portfolio for a local Senior Citizens’ Recreation Club. The managing committee has heard that by investing in shares and other financial instruments, the Club could achieve a higher return than what is currently earned through an internet cash maximiser account. The committee has heard that you are currently studying a unit on security analysis and portfolio management. You are required to build a portfolio as at 31 January, 2019, track the performance of your individual investments on a weekly basis through to the end of July, 2019, and submit a report on the rationale of the original portfolio construction (in January, 2019) and its half-yearly performance from 1 Feb, 2019 to 31 July, 2019.
Part 1 Prepare an investment policy statement for the local Senior Citizens” Recreation Club based on what you learn in Topic 1. You may specifically consider the (i) liquidity requirements; (ii) return requirements; (iii) risk tolerance; (iv) time horizon; (v) tax considerations of the Club – taxes and fees relating to the investments should be ignored (vi) regulatory and legal considerations; and (vii) unique needs and circumstances. Further given the sensitivities of the members of the organisation, you are asked to avoid investments that are seen to be socially and ethically NOT responsible.
Part 2 The Senior Citizens’ Recreation Club is considering a mix of equity, debt and cash (or money market) securities. You are asked to determine an asset allocation strategy by considering the current and future economic situation, government policy and monetary
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