J.D.WILLIAM, Inc.

J.D.WILLIAM, INC. Investment advisory firm Managing $120 million funds for its client : Growth stock fund(GF) Income fund(IF) Money market fund(MMF)

 Contracted with a client having $8,00,000 to invest.

PROBLEM:
To allocate $8lakh among the Growth,Income and Money market fund. To develop an L.P model that provide maximum yield for the portfolio. To develop a managerial report on the L.P model.

J.D.WILLIAM, Inc.
Assets Allocation Model

Growth fund(GF)
Amount invested: 20-40% of total portfolio Risk : 0.10 Annual yield : 18% of GF (0.18GF)

Income fund(IF)
20-50% of total portfolio 0.07 12.5% of IF (0.125IF)

Money Market Fund(MMF)

>=(at least)30% of total portfolio 0.01 7.5% of MMF (0.075MMF)