For this assignment, you will be creating an investment portfolio allocating $100,000 in funds you won in a hypothetical lottery (see the scenario below). An
investment portfolio is a collection of assets and can include investments like stocks, bonds, mutual funds, and exchange-traded funds. Two of the most
important things to consider when creating a portfolio are your diversification strategy and personal risk tolerance.
For this week’s assignment, you will be further developing your investment portfolio that you started in Week 2. You will also need to create and include a
graphic (e.g., table, chart) that illustrates your dollar or percent allocation of the $100,000 investment funds.
Scenario: Imagine you have just won $100,000 in a lottery. You want to invest this money wisely so it can grow over time and help you achieve your overall
investment goals.
In your paper, include:
Financial Situation and Goals
Describe your current financial situation at a high level.
Consider discussing your current and future income potential, current debt, current investments, and anything else significant that can impact your
investment strategy.
Review what you submitted for your Week 2 Assignment and incorporate any instructor feedback provided.
Create at least two investment goals for yourself that are SMART (specific, measurable, attainable, realistic, and time-bound).
Review what you submitted for your Week 2 Assignment and incorporate any instructor feedback provided.
Investment Types and Rationale
Identify at least three major types of investments you would invest in that align with your goals.
Explain your rationale for why you chose those three specific investment types, including how it aligns with your SMART goals or how it supports your overall
diversification strategy.
Investment Allocation
Explain how you would allocate the $100,000 to invest in the three investment types (e.g., $50,000 to several stocks, $40,000 to bonds, and $10,000 to
mutual funds).
Include a graphic (e.g., pie chart, table, etc.) that illustrates your dollar or percent allocation of investment funds.
Financial Returns and Risks
Discuss what financial return you estimate the investment portfolio to deliver 5 years from now using data and calculations. In other words, how much will
the portfolio be worth 5 years from now?
Be sure to show and . Links to an external site.
Explain two key assumptions you used to arrive at the estimated financial return 5 years from now.
Consider using historical or forecasted data to support the estimated amount.
Discuss one potential risk to your overall portfolio to achieve your desired return.
Portfolio Monitoring
Explain the importance of monitoring your investment portfolio routinely.
