Reference no: EM132491685
Assume you are working in an investment company as an investment advisor. You have a new individual investor ( called Kim) who wants to invest in financial securities.
Kim is 45 years old, married with 3 kids (all in school), works as a marketing manager in an international pharmaceutical company and lives in a big apartment with his family in New York City. Kim is a new investor who is looking for a long-term investment horizon and aiming income gain from his investment to spend on his kids educations and also save for his retirement.
Kim is a risk-averse investor, who does not like to take a high risk when investing, with very limited investment knowledge . Accordingly, his confidence in his investment knowledge is low , so he needs your advice regarding which type of mutual funds he should invest in that meets his investment aim.
A) According to Kim's demographic factors and investment aim, would you advise him to invest in a specific financial security (as individual bonds and stocks) or invest in a mutual fund? (Why explain your answer )
B) If you decide to invest in a mutual fund, what type of the following mutual funds (money market fund, fixed income fund, balanced fund, equity fund, index fund, or global fund) would you select to invest in for Kim and why? (Explain)
(Hint: select One type of mutual funds that is most suitable for Kim's demographic factors, investment aim, investment horizon, and risk tolerance level).
C) Analytically Explain in details why you have selected this specific type of mutual fund for Kim? (Consider the risk and return of the selected fund and the current economic situation).
D) Explain the financial securities that are included in the selected mutual fund?