NEED RESPONSES FOR 3 POSTS

Need responses for below 3 posts individually 40-50 words

POST1 Our textbook tells us we are taking a risk anytime we cannot be certain about the outcome of an event or activity or we don’t know what the outcome will be in the future. We also learned that risk and return are related, and when someone offers you an investment with a high return then you are also taking a high risk. (Besley & Brigham, 2015)   With so little information being known about PAID it is definitely high risk.  Therefore, I wouldn’t feel comfortable investing in PAID or offering it to clients of RIP.  Not only would I be recommending a virtually unknown investment to clients, I would be putting the reputation of RIP on the line.  This could have a detrimental effect on my job, as RIP has an impeccable reputation.  I wouldn’t be able to fully advise clients either, as little is known about PAID.  Howard is a friend, and as much as one would like to help him, you have to wonder if he isn’t just trying to make PAID sound so good because he needs pulled out of his financial crisis.  And he is in a financial crisis because he made bad investments.  He is trying to say PAID can’t fail because there are government agencies involved.  However, he can’t offer information as to the extent or type of the government agencies involved.  I would explain to Howard that ethically I wouldn’t be able to take part until further information is available about PAID and I would have to pass on this deal. 

POST2

First off, since there is little to no information around PAID, I would not consider this as an investment opportunity.  I would need to know more information around this investment program in order to even consider this as a solution for my future clients looking to retire. It is especially concerning that even Howard - the person who is recommending it - is unsure how the investment in constructed and even what the name truly means.  According to Besley, Brigham & Eugene (2015), "if you lose sleep over your investments or are more concerned with the performance of your portfolio than your job performance, then your investment position probably is too risky" (p. 433).  In this scenario, investing my clients money with PAID without a high degree of information or understanding of their risk impact and expected rates of return, would definitely keep me up at night worrying.  I would recommend asking for a more detailed overview of this investment directly from PAID, as well as any company historical return information. This is not only impacting your future, but the retirement future of many others, so RIP needs to carefully analyze any investment opportunities before making any major investment decisions.

Secondly, this recommendation is a conflict of interest.  I believe a financial investment decision should never be made with personal incentives at heart. In this case, helping saving Howard out of his financial situation should not be a determining factor for my investment decisions at Retirement Investment Products (RIP).

POST3

 At this time, I would be unwilling to recommend PAIDs as an investment. Retirement Investment Products’ reputation is “impeccable because the service agents who advise clients are required to fully inform their clients of the risk possibilities that exist for any investment position, whether it is recommended by an agent or requested by a client” (Besley & Brigham, 2015). An agent would be unable to fulfill this duty if they were to recommend PAIDs as an investment. There is simply not enough information out there to responsibly inform clients, even if it was client requested.

 While it may seem like a tempting prospect, and sizable commissions could be earned if the higher returns pan out, you could just as well miss out on all commissions if this investment does not pan out. Not to mention, RIP’s reputation could be tarnished and your customer’s lives would be ruined. I think the safe alternative would be to continue recommending fully vetted investment options until more is known about the risks involved in PAIDs. As far as Howard’s situation goes, that is quite unfortunate, but I’m not willing to put my company’s reputation and client finances on the line in order to bail him out. Perhaps Howard’s willingness to invest in non-vetted investments (like PAIDs) got him into this situation in the first place.