FIN683 Investment Analysis Paper

FIN683 Investment Analysis Paper

Part 1

You are a newly hired financial advisor at a money management firm. You have been asked to help create a bond portfolio for one of the firm’s clients. This client is 52-years-old, has no debt, and has significant assets under management with the firm. The client has allocated 2% portion of their assets for individual bond investing. This segment of the portfolio is held in the client’s retirement accounts, and the client expects to retire at age 65. The client has an average risk tolerance. Within this bond portfolio, the client has asked the firm to propose eight bonds for this fixed-income investment portfolio.

Choose one of the bonds. ( Kraft Heinz Foods Co – BRK4362687 )

Source: http://finra-markets.morningstar.com/BondCenter/BondDetail.jsp?ticker=C658389&symbol=BRK4362687

Download and review the prospectus for your chosen bond. Include in your post:

An illustration of the scheduled cash flows for your chosen bond.
A brief list of the affirmative covenants in the indenture of your chosen bond.
A description of any specific contingency features of your chosen bond (put, call, conversion features, etc.).
Propose two reasons an investor would purchase this bond.
Attach the prospectus for your chosen bond to your discussion post.
PART 2

For this discussion forum, visit the FINRA website and conduct a search for one additional bond. Choose one type of bond from one of the categories below:

Non-sovereign government bonds (e.g., bonds issued by U.S. states and cities)
Quasi-government bonds (e.g., Fannie Mae, Freddie Mac, etc.)
Once you have chosen your bond, download the prospectus and review it.

In your post, compare your chosen bond to a similar maturity U.S. sovereign bond (e.g., U.S. treasury note fixed or floating rate). To select a similar maturity sovereign bond, you can search on the FINRA website, click on “Government,” and use the advanced search to choose U.S. treasury bills, notes, or bonds. You can also find government bonds by visiting the Wall Street Journal Market Data Center. Be sure to discuss the following in your comparison:

Rating
Cash flow
Security/collateral
Current yield
Conversion features
Put/Call features
Other unique features
Two reasons investors would choose this bond for inclusion in a fixed-income portfolio

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