Question

1: In 200 words or more, define the word investments and outline with elaborations the investment management process.

2: In 200 words or more, define Fundamental Analysis and the three-step valuation process, economic forecasting, and macroeconomic analysis.

3: In 200 words or more, define Industry Analysis and outline the role the global & domestic economies, exchange rates; business cycles; industry analysis; the industry structure and performance; and the competitive strategies.

4: In 200 words or more, define Portfolio Management and also outline with elaborations the portfolio management process and strategies.

Answer 1

1.  An investment is a purchase of a security or an asset not with the intention of present consumption but to sell it later so that in the meantime, it appreciates and gives you some return at the cost of some risk.
Investment management process involves 4 process:
1. Defining the Objectives: An investment manager should first sit down and set the objectives(goals and visions) which suit his clients.
2. Asset allocation: A manager then needs to allot the assets in the light of the first step.
3. Portfolio construction: The manager, then, should start constructing the portfolio in the light of the above 2 points.
4. Feedback: Each portfolio needs to be monitored in a specified time interval for the returns and for the objectives.

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