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Investment policy statement: Mr. Borges

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Resumo:This Master’s Final Work (MFW) is aimed at developing an Investment Policy Statement (IPS) for a fictional individual investor, Mr. Borges. The IPS is crafted to attend the client’s investment objectives, required return, and investment constraints. An adequate investment philosophy was chosen for the client, as well as a strategic asset allocation and security selection. Robust risk analysis was conducted in order to measure the risks Mr. Borges’ suggested portfolio faces, as well as qualitative risk analyses and classification. The IPS outlines a tailored investment strategy for Mr. Borges, a 35-year-old Brazilian government worker with substantial investment experience and an investment amount of BRL 1,000,000.00. His primary objective is to double his invested value over a five-year horizon, achieving a 100% return, either to reinvest in his new online business or to secure his financial future. To meet this objective, an annual return of 18.89%, already adjusted for inflation, is required. Mr. Borges’ risk tolerance is high, preferring bold investments during market downturns. The suggested portfolio focuses on Brazilian blue-chip stocks (80%) and highly liquid government bonds (20%). Specific constraints on equity selection include prohibitions on IPOs, short-selling, and leverage, with a limit of five blue-chip stocks from different sectors. The portfolio will be managed by MG Investments, which will provide quarterly performance reports. Risk metrics such as volatility, Value at Risk (VaR), Conditional VaR (CVaR), and the Sortino ratio will be employed to monitor and adjust for risk. The portfolio will be rebalanced quarterly to ensure it remains aligned with Mr. Borges’ objectives and investment constraints.
Autores principais:Gonçalves, Max Well Elias
Assunto:Portfolio Theory IPS Individual Investor Value Investing Mean Variance Theory Risk Management Teoria da Carteira DPI Investidor Individual Investimento em Valor Teoria Média-Variância Gestão do Risco
Ano:2024
País:Portugal
Tipo de documento:dissertação de mestrado
Tipo de acesso:acesso aberto
Instituição associada:Universidade de Lisboa
Idioma:inglês
Origem:Repositório da Universidade de Lisboa

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