Group Project Final Report - Essay Example

Group project final report The project deals on stock bonds that are traded in the exchange. The investment strategy that should be taken is that of high risk high return. That will be geared towards wealth maximization. Risks can be prevented by diversification. Risk can be diversified by taking up different investments. The risk is also prevented because bonds have a fixed rate of return. The selection of assets can be based on the returns and risks. They can also be based on the wants of the investor.

The monitoring of the investment can be periodical. The investor should set a budget or estimate of the expected results. After a certain time period, the evaluation can be carried out to find out if the investment is turning out as planned. The assumptions that can be applied the fact that the bond’s rate of return will remain constant and will be paid in time. The other assumption is that there will be no external factors that will adversely affect the running of a company. The reevaluation of assumptions can be done based on factors that affect the rate of return of bonds.

The assumptions cannot be accurate because there are many external factors that largely affect rate of return. The things that did not work to our favor include the inflation rates. The inflation rates are dependent on a number of factors that cannot be controlled by a single individual. In reallocating, the investor can consider taking up investments that are in independent industries to ensure that profits are reaped even in the case of economic changes.Work CitedSylvia, P. Introduction to finance and financial decisions. New York. Free Press.2009. Print.