You may use financial planning software to assist in modelling strategic options for the clients and for preparing this report, provided you personalise the content and ensure that it is clear, concise and

Assignment Task

Use of Software

You may use financial planning software to assist in modelling strategic options for the clients and for preparing this report, provided you personalise the content and ensure that it is clear, concise and effective, and conforms to the structural guidelines for the report. Your report must be formatted and presented in a professional manner that would be appropriate to provide to a client.

If you use software, please ensure that you include in the reference list the software provider name, software version number, licensee name and licensee number.

Any material written after this will not be counted towards your mark for that question. Headings, quotes and references within the body of the answer are included in the word count. Numerical tables, calculations and reference lists are not included. For more information on word counts and their rationale, go to Assignment 2 Assessment Preparation Guide

The Assessment Preparation Guide contains information about format and presentation, word limits, citations and referencing, collusion, plagiarism and other policies, useful resources, submitting your assignment and accessing your results.

Independent research

For some or all questions in this assignment, you will be required to complete independent research beyond the provided materials. You will also be expected to analyse this research and use it to support your own reasoned conclusions.

This includes:

  • Considering multiple sources beyond topic notes or other provided resources
  • Ensuring sources are academically sound and credible
  • Analysing and understanding the argument or information the source presents
  • Using the material appropriately to directly support your conclusions

Case study

Your client Jordan Riley (aged 40) has just inherited $500,000 in cash and has approached you for investment advice. Jordan is married with two children. He is an executive earning $200,000 p.a. Jordan states that he has limited knowledge of financial markets and investment products.

He also states that he does not want to own direct shares, either domestic or international.

Scope of the required advice

Jordan is only seeking investment advice for the $500,000 cash inheritance he has received. He has indicated that he does not want to invest in his superannuation.

He has done some research and read up about diversification (i.e. not putting all your ‘eggs in one basket’). However, he is concerned that by diversifying too much, he might miss the opportunity of being with the top performing investments

For this reason, he wishes to invest his inheritance into five (5) different investment products only. He would like one product recommended for each of the following asset classes:

When asked about his investment goals, he stated that his main goal is to maximise returns on this particular investment activity over the long term. Jordan informs you that he does not need to access the funds in the next three years.

You discuss with him some of the available investment products such as managed funds, direct shares, exchange-traded funds, listed investment companies and multi-sector offerings.

He has asked for more information regarding each of these types of products and whether they would be suitable for him.

He mentioned that he is open to any investment options you might recommend, and will be guided by you as to which product you consider appropriate in each asset class. However, he would like to see a comparison of the recommended product with at least one other product in each asset class. Jordan also requires information on performance, fees, manager, investment process, investment philosophy and any other relevant considerations

Investment considerations

  • Maximise investment return over the longer term.
  • Consider market volatility. He would like to reduce volatility if it does not have too much impact on longer-term investment returns
  • Jordan would like your opinion on whether the investments should be active or passive as he has read a lot of good reports about passive investments; however, he is unsure if they help maximise returns or are suitable in this situation.
  • He has also heard of socially responsible or environmentally friendly funds, and would like to consider them, but not at the cost of sacrificing returns.