Tuesday, 27 November 2012
Learning Objective:
To understand the application of bond valuation for investment decisions.
Learning Outcome:
After attempting this GDB, the students would be able to understand the application of bond valuation for investment decisions.
The Case:
Suppose, you are working as an investment consultant in a consultancy firm and most of your clients are habitual investors, who are maintaining their own portfolios comprising of various combinations of stocks and bonds.
Mr. Zahid, a habitual investor comes to you for consulting about adding one more potential investing option to his existing portfolio. Currently, as per your analysis, there are two bonds available in the market with the following data:
*Note: Interest rate fluctuations are high in the market
Required:
Mr. Zahid, a habitual investor comes to you for consulting about adding one more potential investing option to his existing portfolio. Currently, as per your analysis, there are two bonds available in the market with the following data:
To understand the application of bond valuation for investment decisions.
Learning Outcome:
After attempting this GDB, the students would be able to understand the application of bond valuation for investment decisions.
The Case:
Suppose, you are working as an investment consultant in a consultancy firm and most of your clients are habitual investors, who are maintaining their own portfolios comprising of various combinations of stocks and bonds.
Mr. Zahid, a habitual investor comes to you for consulting about adding one more potential investing option to his existing portfolio. Currently, as per your analysis, there are two bonds available in the market with the following data:
*Note: Interest rate fluctuations are high in the market
Required:
- Suggest Mr. Zahid, who is interested to add only one bond to his portfolio about the suitable bond for his portfolio.
- Support your choice by elaborating the reason on which the suggested bond is considered as a preferred option.
Mr. Zahid, a habitual investor comes to you for consulting about adding one more potential investing option to his existing portfolio. Currently, as per your analysis, there are two bonds available in the market with the following data:
