finance report 4 pages

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FRL 433 – Portfolio Management Simulation Spring 2020

Professor: Dr. Majed Muhtaseb, CFA, CAIA

Welcome to FRL 4331 Portfolio Management Simulation. This simulation is very

applied, hands on, challenging, continuous, VERY memorable, high impact

assignment.

PLEASE READ CAREFULLYAND FOLLOW THESE INSTRUCTIONS VERY CLOSELY!

1. Go to stocktrak.com to set up your account. Use the link:

Deadline to register is Monday February 3rd, 2020. Course Name on Stocktrak : CPPFRL4331 https://www.stocktrak.com:443/members/registerstudent?className=CPPFRL4331

2. Complete the Investing Fundamentals exercises on Stocktrak. Multiple attempts are

allowed. This is good preparation for the simulation.

3. Develop an investment objective and strategy before you start trading.

Think about an investment strategy that you are passionate about executing. Make sure that you

use Bloomberg for EVERY report.

The portfolio should be invested in securities listed/traded in US markets. Frequently Use

Bloomberg to construct and manage portfolio as well as when necessary visit relevant web sites.

4. The portfolio management simulation period of 12 weeks, stretches from Friday,

February 7 – Friday May 1st. The final report is due on Wednesday May 6th.

The fund should be at least 80% invested at all times and no later than February 21st.

Initial balance is $10,000,000.00

5. Prepare a bi-weekly 2-3 pages report (450- 550 words NOT counting the tables, figures

and charts) to your investors. Report on your previous two weeks’

economic conditions,

investment activity, including trading activity,

asset allocation,

sector selection,

risk management and

performance statistics and major decisions impacting performance.

6. An average of 15 trades per week is required with a minimum of 12 weeks per week.

The report writing experience will be a unique professional growth process and rewarding hands-

on educational experience.

Tables, figures and graphs are not only encouraged and required but are also rewarded.

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Use Bloomberg for the bi-weekly reports.

“Copy & paste” of tables and figures from Stocktrak is good for D- !

7. On occasions, be prepared to discuss your investment activity with the class.

8. You may invest in Stocks, bonds mutual funds & ETFs only.

Mutual funds and broad market ETFs are allowed up to 20% of fund’s assets.

9. Margin buying and Short selling of stocks and ETFs is allowed.

Options and Futures may account for up to 20% of assets and only to the extent that they

are used as an integral part of the strategy.

10. In writing your reports, it is imperative that you follow the sample monthly fund

reports on BlackBoard.

11. Due dates for Fund Bi-weekly Reports

Simulation

Period

Number

of Weeks

Report Due Date Requirements Investment

Period Dates

Jan 25 – Feb 3 Registration Period

Jan 31 – Feb 7 Complete Investing

Fundamentals

February 7 First Day of Simulation

1 2 February 26 First Biweekly report Feb 7 – Feb

21

2 4 March 11 Second Biweekly repot due Feb 7 – Mar 6

3 6 March 25 Third Biweekly repot due Feb 7 – Mar

20

*** Mar 31 – Apr 3 Spring break Simulation continues

4 8 April 8 Fourth Biweekly repot Feb 7 – Apr 3

5 10 April 22 Fifth Biweekly Report Feb 7 – Apr

17

6 12 May 6 Sixth/Final yearend Report

Last week of classes / Final

Report Due + Presentations

Feb 7 – May

1

May 11-15 Final Exams Week

12. The final report should include the following:

a. Discussion of the portfolio activities (800 - 900 words).

i. portfolio objective & strategy ii. Asset Allocation

iii. major economic events and investment decisions that impacted the performance of

your portfolio

iv. Risk Management v. Performance Statistics.

vi. use of information available through Bloomberg terminals

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b. In 1-2 pages address/discuss key PERSONAL lessons learned by each student,

300-350 words.

c. List all references used on a separate page.

d. Use of tables and graphs is encouraged, required and rewarded.

e. Title page and One inch margins, 12 font.

13. Assuming that the team followed the instructions above, the fund with the highest total

performance on Friday May 1st , (non risk adjusted basis) will earn at least a “B-” grade

for the report.

Any team that follows ALL the instructions and outperforms the S&P 500 index, shall earn a minimum of C for the project.

14. A short presentation to the class may be required.

15. Management of the portfolio is the continuous ongoping responsibility of ALL team

members. Lack of continuous collaboration and involvement shall adversely impact the team’s

report quality and grade.

If team members do NOT cooperate, each member may end up doing the project on his/her own.

16. Feel free to always ask questions should you face any challenges. You may consult with class

mates.

17. Inquire, Enjoy, Learn, Succeed, Lead and Good luck!

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Web sites of GREAT BENEFIT and INTEREST for us! www.fidleity.com

www.vanguard.com

www.schwab.com

Fact Sheet Morningstar style box

https://corporate.morningstar.com/cf/documents/MethodologyDocuments/FactSheets/Morningsta

rEquityStyleBox_FactSheet_E.pdf

Fixed income style box

http://www.morningstar.com/InvGlossary/morningstar_style_box.aspx

https://www.linkedin.com/pulse/3-investing-insights-from-yale-endowment-gary-mishuris-cfa/

https://www.vanguard.com/pdf/icradd.pdf

https://www.gsam.com/content/gsam/us/en/advisors/fund-center/fund-finder/gs-blue-chip-

fund.html#activeTab=literature&callingPage=fundfinder&pvNumber=PV101231&scType=Inve

stor+Shares

https://www.gsam.com/bin/gsam/servlets/LiteratureViewerServlet?pdflink=%2Fcontent%2Fdam

%2Fgsam%2Fpdfs%2Fus%2Fen%2Fprospectus-and-

regulatory%2Fprospectus%2Finternational-equity-insights-funds-pro-

p.pdf&RequestURI=/content/gsam/us/en/advisors&sa=n

https://www.gsam.com/content/dam/gsam/pdfs/us/en/fund-literature/quarterly-fact-

card/INST_BlueChipFund_724909_FC.pdf?sa=n&rd=n

Sortino A better measure of Risk

https://www.sunrisecapital.com/wp-content/uploads/2013/02/Futures_Mag_Sortino_0213.pdf

https://www.forbes.com/sites/phildemuth/2013/10/24/what-is-risk-everything-you-need-to-

know-about-the-sortino-ratio/#3678da1271b3

ETFs

https://www.vanguardinvestments.se/portal/site/institutional/uk/en/insights/etf/overview

https://www.institutionalinvestor.com/article/b1505qt1d6pf70/pensions-and-other-big-investors-

increasingly-turn-to-etfs

Please feel free to share interesting web sites with us.