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Investment Plan 20 Questions (LT05C)Finance 200/418/MBA620I. Introduction and Purpose (3 questions):A. Introduction: Who is this Plan for?________________________________________________B. Purpose: What is the purpose of this plan?________________________________________________C. Principles: What are the investment principles you will follow? ________________________________________________II. Investment Objectives (5 questions):A. Objectives. What are your investment objectives for your assets (groceries)?_______________________________________B. Investment Vehicles. Which investment vehicles (shopping carts) will you use?_______________________________________C. Time Frames. What are your time-frames or stages for this Plan)?_______________________________________D. Return. What is your expected return for your portfolio for these stages?_______________________________________ 1. Stage 1. What is your expected return for your portfolio during before retirement?_______ 2. Stage 2. What is your expected return for your portfolio during retirement?_______E. Risk. What risk-type of investors are you (from your risk tolerance test)?_________________________ 1. Stage 1. What is your expected risk for your portfolio before retirement?_______ 2. Stage 2. What is your expected risk for your portfolio during retirement?_______III. Investment Guidelines and Constraints (2 questions): A. Guidelines. What are your investment guidelines for investing?________________________ 1. Stage 1. What are your investment guidelines before retirement?________________________ 2. Stage 2. What are your investment guidelines during retirement?________________________B. Constraints. What are your investment constraints for your investments?________________________ 1. Liquidity. When will you need the money?________________________ 2. Time Horizon. How long will the money be invested?________________________ 3. Taxes. What are your marginal and average tax rates?________________________ 4. Unique Needs. Any specific individual or family needs that may influence this plan? ________________________IV. Investment Policy (5 questions):A. Acceptable Investments. What are the financial asset classes and assets you will invest in? 1. Acceptable Asset Classes. What are the asset classes you will invest in? _______________________ a. Bonds and cash. What assets will you invest in to gain exposure to bonds and cash asset class?_______________________ b. Stocks. What assets will you invest in to gain exposure to the equity asset class? _______________________ c. Other Assets. What are other asset classes you will invest in to gain exposure to other asset classes? _______________________ 2. Unacceptable Asset Classes. What asset classed will you not invest in?______________________ 3. Debt. Will you use debt to invest? Will you sell short or buy on margin? (I recommend no!) ______________________B. Investment Benchmarks. What are your investment benchmarks by asset class? ______________________C. Asset Allocation. What is your target asset allocation?______________________ 1. Stage 1. What is your target asset allocation before retirement?______________________ 2. Stage 2. What is your target asset allocation during retirement?______________________D. Investment Strategy. What is your investment strategy?______________________ 1. Active versus Passive. Will you invest actively, passively, or both?______________________ 2. Individual Assets. At what portfolio size will you begin buying individual assets?______________________ 3. New Investments. How will you analyze and evaluate new investments?______________________ a. New Investments. What is the maximum percent in any new investment (except MF/IF/ETFs)? ______________________ b. Investments in Company Stock. What is the maximum percent in your company stock?______________________ c. Unlisted/Unregistered Investments. What is the maximum in unlisted/unregistered investments?______________________ 4. Current Investment Strategy. What is your current investment strategy?______________________ 5. Tax strategy. What different types of investment vehicles will you use? ______________________E. Funding. How will you fund your investments?______________________V. Investment Monitoring and Evaluation (5 questions):A. Monitoring. How will you monitor your portfolio?______________________ 1. Portfolio Monitoring Method. How and how often will you monitor portfolio performance? ______________________B. Rebalancing. How often will you rebalance your portfolio?______________________ 1. Portfolio Rebalancing Method. Which portfolio rebalancing method will you use? ______________________C. Communication. How and how often will you communicate results?______________________ 1. Portfolio Communication Method. How will you communicate results? ______________________D. Plan revisions. How and when can this Investment Plan be changed?______________________E. Team Signatures. Who will be following this Plan?______________________VI. ExhibitsExhibit 1. Expected Return Simulation and Benchmarks (LT27)Exhibit 2. Investment Process Worksheet (LT 13)Exhibit 3. Financial Asset Pages from Morningstar for each of your chosen mutual funds/index funds/ETFs ................
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