Does international diversification enhance risk reduction? Why or why not? What measures may be taken to reduce risks of international portfolio investing?
What are unique risks associated with foreign investments? How might an investor protect his or her portfolio against such risks? Is it possible to protect a portfolio from all risk?
Resources: Constructing and Managing a Portfolio Simulation, Electronic Reserve Readings, University Library
Complete the Constructing and Managing a Portfolio simulation on the student website.
Conduct research concerning the risk and return tradeoff, and the relationship between investment strategy and performance.
Prepare a 1,050- to 1,400-word memo to Rainier Ekstrom, Casa Bonita’s chief executive officer, in which you analyze risk and return tradeoffs associated with the organization’s investment portfolio. Address the following:
Decisions you made in the simulation
A discussion of how the Sharpe ratio helps make...