Influence asset allocation decisions.
Project instructions:
1. What are the two main asset classes and what assets are included in each?
2. What are two sources of distortions in financial reporting?
3. What are the two factors from the text that influence asset allocation decisions?
4. Name three key regulatory groups that provide for ethical financial reporting.
5. Provide the formula (not imbedded in an Excel spreadsheet) for the Capital Asset Pricing Model (CAPM). Describe the terms used in the formula.
6. What are the nine macroeconomic factors that influence a portfolio?s performance?
7. Provide the formulas (not imbedded in an Excel spreadsheet) for the Sharpe ratio, Treynor ratio, and Jensen?s Alpha. Describe the terms used in the formulas.
8. What are the five groups of derivative investments?
9. What financial tool best measures liquidity? Why?
10. For personal finances, name two investment choices.