Length: Semester
Type: Individual
Level: Intermediate

Learning Objective: Students will learn how create diversified portfolios and allocate assets depending on varying risk tolerances. 

Instructions: 

Your assignment is to create three different portfolios for each of the client risk tolerance profiles (1 low risk, 1 moderate, 1 aggressive). For each, decide:

  • How much to invest in equities, ETFs, and fixed income. 
  • Within the realm of equities and ETFs, decide how much to allocate between:
  • US, developed international, and emerging markets
  • Within the U.S., between value and growth stocks or funds
  • Within the U.S., between large cap and small cap
  • Within the realm of fixed income, decide how much to allocate between:
  • Short term vs. long term bonds
  • US Treasuries vs. investment grade corporates vs. high yield bonds

Provide a reflection with a summary of your asset allocation approach for all three portfolios. You must also expand on your rationale for each of these decisions for all three portfolios. Make sure to comment on how the three differ. 

Monitor each portfolio's performance and volatility throughout x weeks and compare their relative performance in the context of risk/reward and each portfolio’s client profile. 

Deliverables:  

  1. Portfolio holdings page (for all three portfolios)
  2. Exercise reflection

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