Assume that you recently graduated with a major in Finance and you landed a job as a financial planner with a large financial services corporation. The organization where you work has a...

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Assessment Title: Managing Assets of Clients to Earn Maximum Return at Minimum Risk.
Table of Contents:
1. Introduction
2. Section 1: Investment Alternatives Available
3. Section 2: Account Management Strategies
4. Section 3: Economy’s effects on Asset Management
5. Section 4: Impact of Taxation on Portfolio Selection
6. Conclusion
Introduction:
Portfolio Management refers to the process of managing the funds of clients that are invested
into different securities, so that the objectives of the investors are met. A portfolio is constructed
ased on the needs of investor’s financial objectives. For example, a young investor generally
invests for a longer period of time, so he should invest in growth stocks which have high risk but
also, high return. On the other hand, an old person would like to invest in low risk securities
which will give lower return but the risk will be lower as well. Different securities in which the
funds are invested are Equity, Debt, Derivatives, Mutual funds etc. Portfolio Management of an
investor by a manager should be based on two considerations i.e. risk and return. Risk refers to
the chance that the actual return of portfolio differs from thee expected return on portfolio.
Return is the measure of gain that a security gives over a period of time.
The first part of this report contains in dept analysis of various Investment Options that are
available to an investor including (bonds, stocks, derivatives, and so on) available to an investor
investing for a long period of time (specifically for 5 years or more). In the second part we will
analyze the Account Management strategies (including both Active and Passive strategies). The
third part contains the state of economy on the Asset Management. The last part contains the
details about the impact of estate and other tax considerations to provide optimal financial
outcomes.
Section 1: Investment Alternatives Available:
There are generally two types of assets in which investment can be made:
· Real Assets: Real assets are tangible material things like building, automobiles, land, gold etc.
· Financial Assets: Financial assets are piece of paper representing an indirect claim to real assets
held by someone else. These pieces of paper represent debt or equity commitment in the form of
IOUs or stock certificates. The portfolio manager has to allocate the funds of the investor in a
portfolio in such a manner that the financial needs of the investor has to be met. This process is
called diversification, so that the overall risk and return profile of the investor is met.
Investment avenues can be
oadly categorized under the following heads:
· Corporate securities include Equity shares, Preference shares, Debentures/Bonds, Wa
ants and
Derivatives.
· Government and semi government securities.
· Mutual fund schemes.
Corporate Securities: These are the securities issued by the company to raise funds for business
purposes. The classification of corporate securities is:
Equity Shares: Equity is commonly refe
ed to as shareholder’s funds. These are the owners of the
Company. In case of liquidation of company all the amount remaining after payment of all liabilities and
Is allocated to Equity. In the balance...