INVESTMENT ANALYSIS AND STRATEGY

Investment Analysis and Strategy

Portfolio Management

The purpose of this assignment is to invest £10,000,000 by forming a portfolio. Firstly? I have discussed the general investment trends and environments and than shown how I made portfolio and invested £10,000,000 in order to generate maximum profits. Asset allocation is based on the incontrovertible truth that a portfolio needs to be structured on the basis that no one can predict the future. A colleague of mine predicted that the S&P 500 would be up about 17% in 2009. He is now rationalizing his inaccuracy by blaming the sub-prime mess. "If it hadn't been for that? I probably would have been right."

Why Choose Industry?

To begin with? investors should decide on a strategy for allocating their assets. My choice is to use bonds. This way we can identify the best manager for any particular category. Do not use index funds. Index funds are glorified traps in down markets. They are not actively managed? so no one is there to save the investor in down markets. There is an active manager that is superior to any index fund.

The investment management business has several facets, including the recruitment of professional fund managers, research (of individual assets and asset classes), which is the solution, marketing, internal audit and reporting for customers. The largest financial fund managers are firms that exhibit all the complexity of their size demands. Apart from the people who bring the money (sellers) and those who direct investment (fund managers), there are compliance staff (to ensure accordance with legislative and regulatory constraints), internal auditors of various kinds (for examine internal systems and controls), the controllers (to account for money from their own institutions and costs), computer experts, and employees of "back office" (a follow-up operations and recording and valuation of funds for up to thousands of clients per institution).

Institutions often control huge shareholdings. In most cases act as fiduciary agents rather than principals (direct owners). The owners of shares in theory have great power to alter the companies that own the rights to vote through transportation fees and the consequent ability to pressure managements, and if necessary outside of their vote at annual meetings and other .

In practice, the ultimate owners of shares often do not exercise the power they have collectively (because the owners are many, each with small holdings), financial institutions (as agents) sometimes do. There is a general belief that shareholders - in this case, the institutions that act as agents, can and should exercise more active influence on the societies in which they own shares (for example, to keep the account managers to ensure Boards effective functioning). This adds a pressure group to the (regulatory authorities and the Board) overseeing management.

However, there is the problem of how the institution should exercise this power. One is for the institution to decide, the other is for the institution to the survey of beneficiaries. Assuming that the surveys institution, if then: (i) vote the whole farm as ...