Equity Analyst Project:
Asset Allocation ExercisePurpose
To enable the student to demonstrate proficiency in the first stage of a top-down, three-stage valuation analysis: analysis of investment prospects in the U.S. macroeconomy.
This individual assignment involves an analysis of general economic conditions or systematic risk, i.e., the risk that affects all industries and companies, in the U.S. macroeconomy.
You will be asked to determine in percentage terms an optimal allocation of $1,000,000 among the following three asset classes: U.S. equities, U.S. Treasury bonds, and cash. The goal is to maximize your expected return over the next 12 months. A one to two page business brief is needed providing your analysis of the asset classes’ prospects and your justification of your allocation among them.
- Read the Equity Analyst Project document that your professor will distribute during Week 1.
- Conduct any necessary research so that you can make a proper analysis.
- Review Business Brief Guidelines and Critical Thinking Process.
- A One to Two business brief is needed that includes the following sections.
- Opening: Discussion of the general economic conditions in the U.S. macroecomony.
- Analysis: Discussion on analysis of the economic conditions and risk.
- Recommendation: What is your recommendation and justification for, in percentage terms, of an optimal allocation of $1,000,000 among the three asset classes.