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Asset Allocation & Portfolio Construction

Asset Allocation & Portfolio Construction

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Published by Kumar Gaurav

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Published by: Kumar Gaurav on Jul 03, 2011
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07/03/2011

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at Bajaj Capital Ltd.

Under the guidance of Prof. Venkatesh Bhagavath

institutional investors.` ` ` ` ` Set up in 1964 Leading financial services company offering free advice SEBI-approved Category I Merchant Banker 134 investment centre Cater to Corporates. individuals. HNI & NRI .

` ` ` ` ` ` ` Investments Insurance Tax Saving Retirement Planning Financial Planning Children¶s Future Planning Wealth management .

mutual fund . ‡ limited to equity. needs of an investor and allocate assets depending on his/her age and time horizon Scope ‡ limited to India region only. risk appetite. bonds.‡ Asset allocation and portfolio construction Problem statement ‡ study the risk tolerance.

` ` Random sampling Questionnaire was developed Primary source 15 dummy clients Branch manager Other employees .

com by Rao .com www.bajajcapital.investopedia.Secondary source Investment analysis and portfolio management Reilly/Brown Fundamentals of investment market by Balaji www.

Risk tolerance depends on Age Duration of investment Current income Current liabilities Asset composition depends upon risk appetite .

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Cash/Short term Equities Short term Conservative balanced Growth Aggressive growth Most aggressive 100% 30% 10% 5% 0% 0% 0% 50% 45% 30% 25% 0% 0% 20% 45% 65% 75% 100% Bonds .

` ` ` ` ` ` ` personal situation investment objectives present allocation Asset class selection Decide allocation percentage Implement the plan Review it regularly .

risky job Update with return & risk of asset classes Understanding client¶s needs and his risk is important Investment should be spread across asset classes Return is positively correlated to risk .` ` ` ` ` Wealth management .

` Thank You .

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