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Advanced Portfolio Manager Assignment Sample

Introduction

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The study is aiming to discuss the performance of an investment portfolio of a client named Mr Sharp. The study focuses on analyzing an existing investment portfolio and discussing some of the issues present in the investment portfolio. Thus, the study involves performing analysis based on the different factors related to the different investment type and pattern. This study is also aiming to develop a new investment portfolio with some modification in the existing portfolio by involving selling or buying some holding, determining Market price, market values of different shares, Investment Trust and Bonds owned by Mr. sharp. The study is also aiming to develop a proper retirement plan for Mr Sharp at the age of 60 by highlighting some modest capital growth and the scope of providing some possible sustainable income stream.

Question A: Discussion of investment Portfolio performance

 The investment report project always consists of three different components: first, stock purchase table, second, weekly stock value, and the third one is a short letter report. In this regard, a discussion is aiming at the performance factors of Mr Sharps investment performance and its aims and objectives to reach a perfect return margin. In this portfolio, it can be seen that Mr Sharp has been investing his funds in many shares, bonds and trust. To forecast a better return in these shares, bonds and trusts, needs some critical analysis. The evaluation is needed to determine the better option for Mr Sharp to take in his future investments. At first, Mr.sharp is a lawyer in the city of  London, and 45 years old. Mr Sharp has an annual salary of 190,000 pounds and is prosperous to get a "rainy day" fund. Mr Sharp needs his funds to remain as "liquid savings" and not necessary to generate any income in the near future. The portfolio of Mr Sharp shows that Mr Sharp had invested in many shares and bonds in the past. As per the result, the portfolio is showing that most of the investments are running in the profit margins. The value of Mr Sharps existing shares are growing at an impressive value level. The analysis here was made in December 2019, and here the report will be made on some different aspects such as the total assets of the investor and its return, risk etc. As per the portfolio, Mr Sharp has invested his shares in banks, Tobacco companies, Retail markets and everywhere, such as Royal Bank of Scotland, HSBC, Sainsbury and everywhere. Most of these shares became double or triple in case of return. So as a basis of investing in shares are looking profitable for Mr Sharp. Only in the case of Lloyds Bank, the current value of the share has decreased. So in the near future, Lloyds Bank will not be the better option for Mr Sharp to invest in shares.

On the other hand, all the other companies and banks are giving better returns than the current value figure shown in the portfolio. As per the result, all the other options except Lloyds Bank are better for investing funds in the future. The actual formula of evaluating the rate of return is

Figure 1: Annual rate of return formula

(Source: https://corporatefinanceinstitute.com/resources/knowledge/finance/rate-of-return-guide/)           

 

Securities

Holding Shares

Current Market Price

Current Value of Shares

Performance / detail

ORDINARY SHARES

Lloyds Bank                               

 1300

79

1,027

As per the current value of this share, it shows that the Lloyd bank's share value has decreased. There are several ways to evaluate the shares expected return and risk. As Mr Sharp is getting a return rate of 0.15% p.a. so the expected return in three consecutive years will be [0.3(0.15%)] 0.00045 in the future. As well as the risk proportion will be extremely high in this investment. 

Royal Bank of Scotland         

700

214

1498

According to the current value of this share. It is clear that the share value of Royal Bank has increased. As per the current value, the report is showing that the share has a very high rate of return. the return rate of this share is, but as per the calculation, the actual return value in 3 consecutive years is 0.28%

Barclays  

1200

240

2880

As per the current value of this share, it is showing that the value of Barclays share is increasing. According to the report, the share amount of Barclays has increased. In that case, the return rate is very high, and the risk rate is low. The total rate of return is 0.33%.

HSBC                                 

 1000

621

6210

According to this investment, the current value of HSBC has increased. The share's current value shows that the return rate is very high and the risk is low. The total rate of return is 6.21^0.33-1= 0.826%.

BAT    

400

3223

12892

According to the current value of this share, it is showing that the value of BAT'S share has increased. So clearly, the return rate is extremely high in this scenario, and the risk factor is low.  The total value of the rate of return of this share is 32.23^0.33-1= 2.145.

Imperial Tobacco                  

 500

3610

18050

According to the share of Imperial Tobacco, it is showing that the current market value is at a high level of potential. So basically, the company's share is giving a high rate of return, and the risk factor of this share is low. The total value of the rate of return in this share is 36.1^0.33-1=2.265.

Marks & Spencer                 

 1050

362

3801

According to the current value of the shares of Marks and Spencer, the value is showing that the profit rate has increased. So basically, the rate of return is very high, and the risk rate is low. The total value of the rate of return is  3.62^0.33-1= 1.52.

Sainsbury's                          

1200

350

4200

According to the investment report of Sainsbury, the current value is showing that the share is getting a high level of return and the risk factor of this share is very low. The total rate of return here is 3.5^0.33-1= 0.5119.

Tesco                                  

 1500

320

4800

The current value of Tesco shows that the share price has increased, and it is getting a high level of return. Also, the risk factor in this share is extremely low. The total rate of return here is 3.2^0.33-1= 0.4679.

J P Morgan Chase    

700

85.50

59850

According to the investment report of JP Morgan, the holding share value of this company was 700, the market price is 85.50, and the current value of this share is 59850. So, in that case, the current value of this share has increased. The rate of return of this share is at a high level of potentiality as well as the risk is low. The total rate of return here is 85.5^0.33-1= 3.34.

Wal-Mart Stores

800

73.90

59120

According to the investment report of Wal-Mart Stores, the Holding Share Value is 800, the market price is 73.90, and the current value of this share is 59120. as per the current value of the share has increased. The return rate is very high as well as the risk factor is low. The total rate of return here is 73.9^0.33-1=3.1366.

RSA Insurance                      

600

578

3468

According to the investment report of RSA Insurance, the value of the holding share price is 600, the market price is 578, and the current value of this share is 3468. the current value of the share has increased. The return rate of this share is at a high level of potentiality, as well as risk level is low. The total rate of return is 5.78^0.33-1=0.7841.

Schroders                              

400

3080

12320

According to the report of Schroder’s regarding investment, the holding value of shares is 400, the market price is 3080, and the current value is 12320. The return rate of this share is extremely high, and the risk level is very low. The total rate of return here is 30.8^0.33-1= 2.099

INVESTMENT TRUST

Fidelity China Special Situations IT

1100

165

1815

According to the report of Fidelity China regarding investment, the holding value of a share is 1100, the market price is 165, and the current value is 1815. the current value has increased to 1815. here the return rate is very high, and the risk factor is extremely low. The total rate of return is 1.65^0.33-1= 0.1796.

BONDS

Barclays Bank Plc  5.75%

12,500 

112

14000

Market capital of 32.27Billion, PE ratio is 21.84, and the Div yield is 0.0053%. Therefore, the particular bond price does not fluctuate that much (Torres, Bulkley & Kim, 2020). For this reason, this can be suitable regarding the security of the invested capital but may not give that much profit margins in the short run. For long term investment, this bond can be suitable in getting profit from the investment. 

Severn Trent Utilities 6.25%

14500

121

17545

Net Variation is -0.23 and percentage change is -0.16%, the bond is not suitable for getting much profit, or it also may involve loss of invested capital due to the negative percentage change, but this percentage loss may not be so high because most bonds have a lower risk compared to equities or property.

Treasury Gilt  1.3/4% 

20000

102

20400

By the “Government compensation scheme, the Gilts are not protected but considered to be safe investments as the UK government provides backup for this investment on the Guilt bonds.

Table 1: Investment portfolio analysis

(Source: Self-created)

Question B: Creating New Portfolio

According to the element set of the actual process variants of the overall system process outsourcing, there must be a certain element set of process generation of mechanism where ongoing system impact is produced on the certain elements' way of organizational improvement within this. In the final system regard, the organization in the sectional input can be produced on the set process of production; the financial set process function can be produced in the present situation based on related set information (Platanakis and Urquhart, 2019). The total study consists of its productive purpose of the process variant of mechanism where the ongoing fundamental set variation of market capitalization process will be implemented on the basis of production set function. In order to get maximum profit from the holdings of the share, it needs to sell those shares having lower Market price as well as fewer prospects for further increase in future. In order to utilize the cask available in the current account of Mr Sharp of £250,000 amount through buying different shapes of the different companies (Quinn, & Ogburn, 2020). The most effective and suitable methods for investment is to invest in the different retail industries having larger amounts of market capital and have a good reputation related to the share values and the P/E Ratio.

Holding

Description

Index

Market Price

Value

ORDINARY SHARES

100

Lloyds Bank                                (LLOY)

FTSE100

40

400

1250

Royal Bank of Scotland                 (RBS)

FTSE100

195

2600

700

Barclays                                          (BARC)

FTSE100

160

11200

500

Imperial Tobacco                            (IMB)

FTSE100

1500

2500

1500

HSBC                                          (HSBA)

FTSE100

621

11,500

1800

Tesco                                               (TSCO)

FTSE100

320

57,600

1000

BAT                                             (BATS)

FTSE100

3000

30,000

1,050

Marks & Spencer                            (MKS)

FTSE100

275

4580

1,200

Sainsbury's                                   (SBRY)

FTSE100

260

5480

500

RSA Insurance                                (RSA)

FTSE100

683

3540

800

Schroders                                       (SDR)

FTSE100

3570

25,800

1050

Wal-Mart Stores (WMT)

NYSE

125

67,820

800

J P Morgan Chase                          (JPM)

NYSE

120

46,500

500

Ocado Group Plc

 

2050

10,250

500

Just Eat plc

 

7985

39,875

400

Morrison Supermarkets Plc

 

175

7,000

INVESTMENT TRUST

1150

Fidelity China Special Situations IT (FCSS)

FTSE350

255

2215

Nominal

BONDS

£14,500

Severn Trent Utilities

6.25%  2029XS0097777253

 

80

17,545

£12,500

Barclays Bank Plc  5.75% 2026XS0134886067

 

120

12,575

£20,000

1.3/4%  Treasury Gilt  2022

 

100

20,150

 

Question C: Retirement plan

Retirement means a certain process to quit the job for the actual age verification system of real-world enterprises that is produced on the basis of their real processing way of job satisfaction process. The salary amount and the given economic situation cannot be determined on the basis of its actual set of processes. The average system plan is being created on the basis of its actual process set of system function into that. The certain elements salary is being calculated and matched up with the current processing set of system verification within it. The timely review is being analyzed with the relational set process should be produced on the basis that the actual set functions are valid on the certain set functional way for analysis must be placed on the current financial impact can be placed for the fundamental set of process management systems within this (Kundu, Khan, & Rahman, 2019). In this regard, it is derived that the financial stability is much more important for the overall process of managing a team product functions by the end of functional input of financial process of system manufacturing will be created on the certain interface production management set process with every financial aspect. The deposited money is being stashed on the basis of its current set system production input must be produced on the basis of their real-world process input by this (Danesh, Ryan & Abbasi, 2018). In the current economic process for the system aspect, the organizational aspect of the study system process can be produced within the basis of its real-world process input system aspect within it. In this overall process, the organizational set process part should be checked in the current way of process management way of development can be produced to its system verification way of the settlement also will be produced on the basis of its real process of the object must be produced on the basis of its related functional system verification can be produced with its real-world process by part mechanism should be clear for this. 

The organizational impact is produced on the basis of its set by set way of process input mechanism must be produced on the current set by set processing units are produced on the basis of the total process of system input into this (Liang et al. 2018). The real-world set variants can be produced on the basis of the real function of the money-making procedure must be placed on the basis of their recent creational impact of the study system procedure into that.

There should be a proper way system plan where the ongoing situation can be overcome to create the set function of the impact that can be produced on the basis of system impact within it. 

Conclusion

The financing system is the current way of process impact, systematic way of adjustment. Here, the current impact is produced on the certain system process of the overall set process to create the economical way of interface within it. According to the portfolio of Mr Sharp, it is clear that the total investment of his share is most profitable. Mr Sharp has invested his shares in many banks, retail sectors and companies. As a result, most of the shares are giving profit to the investor. Furthermore, the return rate of Mr Sharp's share is an extremely high level of accuracy rate, as well as the risk factor is low. As a piece of clear advice for Mr Sharps future investment, Mr Sharp should invest his funds in the same sectors except for the Lloyds Bank. Because the share amount of this bank is continuously decreasing and it gives a low level of return to the investor.

The total study is connected on the basis of its final variants of process study by this actual set processing units are produced on the basis of certain processes for the system advancement within this. The production impact will be produced on the basis of the organization set of the impact that must be produced in the sectional input process where every financial set of terminology must be satisfied and produced for this.

 

Reference list

Journal

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