Assignment 2/3 Preparation
This assignment preparation activity is worth 5% of your total course grade. Assignment
2/3 Preparation should be submitted after Lesson 2.
This activity has two parts, but you are only required to submit Part 1: Personal Risk
Assessment. Please do not submit Part 2: Company Analysis—this activity is intended to
help you prepare to do Assignments 2 and 3.
Introduction
In Assignments 2 and 3, you will get an opportunity to apply what you have learned by
building a simulated investment portfolio. This pre-assignment learning activity is essential
preparation for completing the application parts of Assignments 2 and 3, and is intended to
get you actively involved in dealing with issues related to investing, rather than just reading
about investments. You should start working on this activity as soon as you have completed
Lesson 2 and well before you start working on Assignment 2.
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FNCE249v5 Assignment 2/3 Preparation November 7, 2018
This study source was downloaded by 100000827039679 from CourseHero.com on 08-15-2021 12:06:37 GMT -05:00
https://www.coursehero.com/file/52973296/fnce249-assign2preppdf/
, Part 1: Personal Risk Assessment (submit for marking)
Recognizing your risk tolerance is imperative to understanding the types of assets you
should invest in and the overall asset allocation of your investment portfolio. Your risk
tolerance might change over time or with a change in your personal situation, such as
getting married or having a child.
You can evaluate your personal willingness to take investment risks through self-reflection,
by analyzing past events such as previous losses suffered and the emotions that stemmed
from those losses, by speaking with knowledgeable investment advisors, and by completing
one or more risk tolerance assessment questionnaires. These questionnaires use the
answers you provide to various questions to score your risk tolerance and provide an asset
allocation based the score you achieve. An asset allocation sets the percentage of equities,
fixed income (bonds, etc.), and cash into which your portfolio assets are to be divided.
Be aware, though, that these questionnaires may not always accurately define your risk
tolerance; you must also use common sense. After completing a questionnaire, if you find it
m
is not a reasonable reflection of your risk tolerance, you may find it beneficial to complete a
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second questionnaire from a different source.
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Note: Before you can purchase mutual funds in Canada, an investment advisor must
complete a risk assessment for you.
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Required: rs e
ou urc
Read Lesson 2, Lesson Note 3: Assessing Personal Risk Tolerance, and complete Lesson 2,
Practice Problem 3 before beginning Part 1 of this Assignment 2/3 Preparation.
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Prepare your own personal risk assessment using a questionnaire and self-reflection. Your
vi y re
submission should include the following:
Two or three short paragraphs in total (from three to four sentences in
each paragraph), discussing personal willingness to take risk, personal
ed d
ability to take risk, and unique circumstances that may apply to you.
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When I first started to focus on my personal investment strategy, I was categorized
as being willing to take a limited risk (160 – 190 Conservative with low-risk
tolerance). I focused on long-term investments as the amount of money I had
available for investment and my ability to recoup a loss was low. As I have aged
is
and my financial security has risen, I am more willing to take some risks with
investing in opportunities with a higher degree of risk as I am able to recoup these
Th
losses at a more rapid rate.
Revisiting a risk questionnaire after many years has shown me that I need to
connect with my financial advisor and assess my current portfolio of investments to
sh
ensure they align with my current willingness to take risks. I am now ranked as
191 – 230 Balanced with above-average risk tolerance. With the number of years
remaining until my retirement date reducing, I feel I need to increase my risk
tolerance and 2readjust my portfolio. Higher returns that will offset inflation and
the cost of living during retirement are critical to me today.
FNCE249v5 Assignment 2/3 Preparation November 7, 2018
This study source was downloaded by 100000827039679 from CourseHero.com on 08-15-2021 12:06:37 GMT -05:00
https://www.coursehero.com/file/52973296/fnce249-assign2preppdf/
This assignment preparation activity is worth 5% of your total course grade. Assignment
2/3 Preparation should be submitted after Lesson 2.
This activity has two parts, but you are only required to submit Part 1: Personal Risk
Assessment. Please do not submit Part 2: Company Analysis—this activity is intended to
help you prepare to do Assignments 2 and 3.
Introduction
In Assignments 2 and 3, you will get an opportunity to apply what you have learned by
building a simulated investment portfolio. This pre-assignment learning activity is essential
preparation for completing the application parts of Assignments 2 and 3, and is intended to
get you actively involved in dealing with issues related to investing, rather than just reading
about investments. You should start working on this activity as soon as you have completed
Lesson 2 and well before you start working on Assignment 2.
m
er as
co
eH w
o.
rs e
ou urc
o
aC s
vi y re
ed d
ar stu
is
Th
sh
FNCE249v5 Assignment 2/3 Preparation November 7, 2018
This study source was downloaded by 100000827039679 from CourseHero.com on 08-15-2021 12:06:37 GMT -05:00
https://www.coursehero.com/file/52973296/fnce249-assign2preppdf/
, Part 1: Personal Risk Assessment (submit for marking)
Recognizing your risk tolerance is imperative to understanding the types of assets you
should invest in and the overall asset allocation of your investment portfolio. Your risk
tolerance might change over time or with a change in your personal situation, such as
getting married or having a child.
You can evaluate your personal willingness to take investment risks through self-reflection,
by analyzing past events such as previous losses suffered and the emotions that stemmed
from those losses, by speaking with knowledgeable investment advisors, and by completing
one or more risk tolerance assessment questionnaires. These questionnaires use the
answers you provide to various questions to score your risk tolerance and provide an asset
allocation based the score you achieve. An asset allocation sets the percentage of equities,
fixed income (bonds, etc.), and cash into which your portfolio assets are to be divided.
Be aware, though, that these questionnaires may not always accurately define your risk
tolerance; you must also use common sense. After completing a questionnaire, if you find it
m
is not a reasonable reflection of your risk tolerance, you may find it beneficial to complete a
er as
second questionnaire from a different source.
co
eH w
Note: Before you can purchase mutual funds in Canada, an investment advisor must
complete a risk assessment for you.
o.
Required: rs e
ou urc
Read Lesson 2, Lesson Note 3: Assessing Personal Risk Tolerance, and complete Lesson 2,
Practice Problem 3 before beginning Part 1 of this Assignment 2/3 Preparation.
o
aC s
Prepare your own personal risk assessment using a questionnaire and self-reflection. Your
vi y re
submission should include the following:
Two or three short paragraphs in total (from three to four sentences in
each paragraph), discussing personal willingness to take risk, personal
ed d
ability to take risk, and unique circumstances that may apply to you.
ar stu
When I first started to focus on my personal investment strategy, I was categorized
as being willing to take a limited risk (160 – 190 Conservative with low-risk
tolerance). I focused on long-term investments as the amount of money I had
available for investment and my ability to recoup a loss was low. As I have aged
is
and my financial security has risen, I am more willing to take some risks with
investing in opportunities with a higher degree of risk as I am able to recoup these
Th
losses at a more rapid rate.
Revisiting a risk questionnaire after many years has shown me that I need to
connect with my financial advisor and assess my current portfolio of investments to
sh
ensure they align with my current willingness to take risks. I am now ranked as
191 – 230 Balanced with above-average risk tolerance. With the number of years
remaining until my retirement date reducing, I feel I need to increase my risk
tolerance and 2readjust my portfolio. Higher returns that will offset inflation and
the cost of living during retirement are critical to me today.
FNCE249v5 Assignment 2/3 Preparation November 7, 2018
This study source was downloaded by 100000827039679 from CourseHero.com on 08-15-2021 12:06:37 GMT -05:00
https://www.coursehero.com/file/52973296/fnce249-assign2preppdf/
